DISHONORED BILLS OF EXCHANGE.

West Coast Times, Issue 2788, 9 March 1878, Page 2

DISHONORED BILLS OF EXCHANGE.

(European mail).

The Daily News gives the following paragraph in its City article:— We are *?£???• tbe caße ia question is that of Wilhama v. Ayers, which, in Adelaide, will be understood to refer to the estate of Messrs Philip Levi an 1 Co., 1866, under the proviso is of the fnsoWeat Act: — Our attention has been drawn to a case recently decided in the Judicial Committee of the Privy Council on appeal from the Supreme Court of South Australia, which will have an important bearing on commercial practice. The facts are that an English firm wished to prove £4000 on an insolvent estate for re-exchange on certain dishonored bills of exchange. The appellants alleged that the claim arose as follows, viz: — Four several bills of exchange, amounting to £20,050, weie handed to them for the purpose of i repaying advances, and credit for the amount of the said bills (less the.exchange) was given in the account,, it being believed that the small bills would be duly paid. Every endeavor was made to discount or sell the said bills, but without success ; consequently, all the bilis were forwarded by the drawers to Australia. Two of them were accepted, but dishonored at maturity ; the other two were dishonored for nonacceptance, and all the bills were returned to England. It was further alleged that the dishonor of tbe said bills caused '• extreme loss and inconven'ence," for which ihe sum claimed for re-exchange was not j an equivalent. The respondent in the case i urged that the bills were not negotiable instruments, and as a fact they were refused by all bankers to whom they were offered. It must be borne in mind that there was no special new consideration given for the new drafts, and the original debt of respect of which they we're given was as much due to the partners who happened to be residents in Australia as to those in London. In a word, no special damage accrued from the dishonor of the drafts ; and without g )ing through the form of applying for the acceptances the applicants had, at any time before the bills were given, the power of suing their debtors in Australia or London for the imount of the debt, and their position or remedies could not therefore have been in any way improved by tha said bills, The judgment of the Supreme Court rested on the authority of a variety of legal opinions, mainly to the point that under the circumstances the documents relied on were not such as would carry upon dishonor the legal incident of re-exchauge, which by the custom of merchants attaches to bills of exchange properly and formally drawn. This vie\v has been upheld on appeal.