S. 62. clear. Now, apparently, if the acceptor has the bill in his possession, it is open to him to show by parole evidence, that the rights of the holder have been renounced. But there is a presumption that a bill in the hands of the acceptor has been paid, and consequently the acceptor will not be bound to prove the verbal renunciation until it has been shown that no payment has been made by him.2 The Act does not say that the writing must be signed. In the case of George,3 Chitty, J., reserved his opinion as to the necessity of signature, but in giving judgment said, "I see great danger in holding that the signature is not required. I leave the point wholly undetermined." S. 63. Cancellation. f If the discharge is absolute, intermediate parties will also be discharged in a question with the party granting it, unless it is granted in bankruptcy.* g See s. 29. 5 h It is sufficient if the holder, before he takes the bill, knows that the bill has been discharged, or that the liability of any particular party has been discharged. In that case he cannot enforce the bill either against the person who has been discharged, or against any party to whom the person so discharged is liable. a 63. (1.) Where a bill is intentionally cancelled by the holder or his 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 signature by the holder or his agent. In such case any indorser who would have had a right of recourse against the party whose signature is cancelled is also discharged.b (3.) A cancellation made unintentionally, or under 1 Thomson, 233. 2 See s. 59, n.b. 3 1890, 44 Ch.D. 627. 4 See n.d, p. 137, supra; Thomson. 387. 5 See s. 29, n.h i̟ ̧ 6 Thomson, ibid. a mistake, or without the authority of the holder, is S. 63. 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.d a See s. 2. b See as to discharge in bankruptcy section 62, n.4, p. 137. © The agent of a bank to whom a bill had been sent for the purpose of collection, perforated it as paid, and delivered it to the acceptors, who cancelled their signature. This was done under a compromise which he had not been authorised to make and which was subsequently repudiated by the holder. It was found that the acceptors were still liable on the bill.1 Further, on their failure it was found that the collecting bank was liable to the holder in the amount of the bill with interest and the expenses of the action against the acceptors, as damages occasioned by the cancellation of the bill when the acceptors were solvent and liable to summary diligence, but was entitled to an assignation of the holder's rights against the drawers.2 An agent for collection is not rendered liable to the holder merely by cancelling a bill erroneously, if the holder sustains no damage through the agent's fault. 3 d Summary diligence against a person whose signature appears to have been cancelled, is clearly incompetent.* Alteration of 64. (1.) Where a bill or acceptance is materially S. 64. altered without the assent of all parties liable on the bill,a the bill is avoided except as against a party bill. who has himself made, authorised, or assented to the alteration, and subsequent indorsers.a 1 Dominion Bank . Anderson and Co., 1888, 15 R. 408. 2 Dominion Bank v. Bank of Scotland, 1889, 16 R. 1081; affd. 1891, 18 R. (H.L.) 21; [1891], A. C. 592. 3 Prince v. Oriental Bank Corporation, 1878, 3 A. C. 325; Warwick v. Rogers, 1843, 5 M. & G. 340. 4 See s. 98, p. 208. 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 of the bill as if it had not been altered, and may enforce payment of it according to its original tenour.f (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. a A bill which has been altered may be held to be avoided, either because the alteration is unauthorised, or because it is a contravention of the Stamp Acts.1 which has been altered without the consent of parties, whether before or after issue, is thereby avoided, so that, apart from the provisions of this section, nothing is recoverable under it,2 though the alteration has been made so as. to bring the bill into conformity with the original intention of parties,3 or is in favour of the person liable. There was at one time held to be an exception to this rule, if a bill was so drawn or accepted as to facilitate fraudulent alteration.5 This view has recently been pronounced unsound. A person accepted a bill for £500 which had been drawn on a stamp sufficient to cover £4000 in such a way as to be easily transformed into one for £3500. A holder in due course sued the acceptor for the latter sum on the ground that his negligence had occasioned the fraud. It was found that the acceptor was under no duty to take special precautions against fraud of this nature and was liable only for £500.1 But between banker and customer, and drawer and drawee, the rule may be different.2 There is no analogy between bills issued so that they can be altered and bills issued under section 20.3 Under the Stamp Acts a bill which has been altered even with the consent of parties after it has been issued, or in case of a foreign bill after it has become liable to be stamped in this country, becomes a new instrument, and is therefore avoided, unless the effect of the alteration is to make the bill conform to the original agreement.5 b Summary diligence is incompetent on a bill on which there is a patent alteration. But action may be laid on a bill which has been altered, if it is averred that the alteration was made (1) before issue with the consent of all parties or of the defender, or, (2) after issue with consent of all parties or of the defender and in accordance with the original agreement.7 The bill is not discharged. Though action may not be brought upon the bill, it may be brought upon the consideration for which the bill was granted or indorsed, except against a party innocent of the alteration whose right of recourse upon the bill has in consequence of the alteration been lost.8 If a bill which has been vitiated be paid to a person as against whom it is avoided, the true owner, or the payer, 1 Scholfield v. Londesborough [1894], 2 Q.B. 660, [1895], 1 Q.B. 536, [1896], A.C. 514; Imperial Bank of Canada v. Bank of Hamilton [1903], A.C. 49. 2 See s. 59 n.d p. 131, supra. 3 Scholfield v. Londesborough, cit. per Lord Watson, 542. 4 Bowman v. Nichol, 1794, 5 T.R. 537, 1 Ross' L.C. 698; Home v. Purves, 1836, 14 S. 898; Knill v. Williams, 1809, 10 East, 431, 1 Ross' L.C. 700; Hamelin v. Bruck, 1846, 9 Q.B. 306-foreign bill. 5 Brutt v. Picard, 1824, Ry. & M. 37; Byrom v. Thompson, 1839, 11 A. & E. 31; Henderson v. Hay, 1802, M. 17059; see Edinburgh and 6 Thomson, 109; see s. 98, p. 210, 7 See M'Rostie v. Halley, 1850, 12 D. 816; Whitehead v. Henderson, 1836, 14 S. 544. 8 Lee v. Murdoch, Robertson, and Co., 1801, 4 Pat. 261; Sloman v. Cox, 1834, 1 C. M. & R, 471; Atkinson v. Hawdon, 1835, 2 A. & E. 628 ; Sutton v. Toomer, 1827, 7 B. & C. 416; Alderson v. Langdale, 1832, 3 B. & Ad. 660; Imperial Bank of Canada v. Bank of Hamilton [1903], A C. 49. S. 64. S. 64. may recover from that person the amount which has been paid in consequence of the vitiation.1 This applies to a person who is barred by his actings from denying that he authorised the alteration.2 d This exception is declaratory of the common law, and does not exclude the effect of the Stamp Acts. It would apply to an alteration made before issue, or after issue to correct an error, without consent of all parties. Those to whom the exception applies are liable for the amount of the bill as altered.1 Apart from this exception and the proviso following, an indorsee who is not responsible for the making of the alteration, has a right to recover from the immediately preceding holder the consideration which he gave to that holder for the bill.5 • In Scholfield v. Londesborough, Charles, J. held that the alteration in question was not apparent, because," although a careful scrutiny might have led to the conclusion that the '3' had been interpolated, and the 'Three thousand added, the alteration is so skilfully effected as not to be at all likely to attract attention." In the Court of Appeal and House of Lords the alteration was treated as not apparent. In Leeds Bank v. Walker, Denman, J., seems to have considered that an alteration was apparent for the purposes of this section, if it was so to the acceptor or maker, though not to any other person. f This proviso alters the common law in making a vitiated bill effectual in any way against those who have become parties to it prior to its being altered. As the proviso gives a holder who is entitled to plead it, right to bring action on the original contract, as if the bill had 1 Kleinwort, Sons, and Co. v. Comptoir National d'Escompte de Paris [1894], 2 Q.B. 157; Imperial Bank of Canada v. Bank of Hamilton, cit.; see s. 59, n.d 2 Scholfield V. Londesborough, cit. per Lord Watson [1896], A.C. 543. 3 S. 97 (3); 1 Smith's L.C. 800; Edinburgh and Glasgow Bank v. Samson, 1858, 20 D. 1246, per Lord 4 Scholfield . Londesborough, cit. per Lord Watson [1896], A.C., 543. 5 Burchfield v. Moore, 1854, 3 E. & B. 683, 23 L.J. Q.B. 261, per Campbell, C.J.; s. 55 (2 c); Thomson, 109. 6 Cit. 71883, 11 Q.B.D. 84, 91. |