The order of payment represented by a bill of exchange cannot, of course, be enforced upon the drawee unless his assent to pay the obliga­tion, when due, be regularly given, which is done by acceptance.

A bill should be presented for acceptance within a reasonable time from the date of issue, and in any case before it is overdue.

The usual form of acceptance consists of the word: accepted, written or stamped across the face of the bill, and followed by the drawee’s own signature. Legally the sole signature of the drawee is,however, a sufficient mark of acceptance.

After the bill is accepted the drawee is called the acceptor.

ADVERTISEMENTS:

In the case of a bill payable after sight\ the acceptor’s signature should be preceded by the date of acceptance, from which time the date of payment counts. A bill duly accepted is commonly called an acceptance.

Acceptance is strictly required for bills payable after sight, and whenever a bill has been made payable at a different place than the drawee’s residence or place of business, in order that the holder may know upon whom he is to call for payment at maturity.

Neither of such bills ought to be, nor is, in fact, negotiated before acceptance. An exception is usually made in the case of foreign bills, as the loss of time necessarily occasioned by keeping the bill travelling to and fro would be prejudicial to the drawer.

The course followed in such cases is that the drawer sends one of the vias (usually the first) to a correspondent of his, at the drawee’s residence, to get it accepted; and negotiates the others on his own responsibility, stating the fact on the face of the bill.

ADVERTISEMENTS:

Bills for a term, payable either on a certain day or after date, do, of course, admit of being presented for acceptance before their falling due, but such a formality may be dispensed with, provided the drawee has received a timely advice of the draft. Such a course, which saves considerable time, is frequently followed in trade when bills are drawn on parties abroad.

As to bills on demand, they require no acceptance, since they must be paid directly on presentation.

Qualified Acceptance.-

According to English law the acceptance of a bill may be either general or qualified.

ADVERTISEMENTS:

A general acceptance is represented, as already said, by the simple word: accepted, or even by the sole signature of the drawee; and conveys an uncondi­tional assent to the drawer’s order; while a qualified acceptance is one which in express terms varies the offect of the bill as drawn, by making the payment dependent on a stated condition, which may refer either to the sum to be paid or to the time, place or mode of payment.

The following are specimens of qualified acceptances.

(a) Accepted for £… only.

(b) ” Payable in three months.

ADVERTISEMENTS:

(c) ” On condition of six months’ renewal.

(d) ,, payable by monthly instalments of £rO.

(e) ,, payable at the National Bank, and there only.

The restrictive words: and there only, in clause c, or others to the same effect, are strictly required to render an acceptance qualified; as the mere indica­tion of a particular place of payment would not alter the general form of the bill.

ADVERTISEMENTS:

The holder of a bill may refuse to take a qualified acceptance; and the drawer and indorser are not bound by it, without assent.

Other forms of acceptance may be resorted to in the case of dishonour, which cases shall be hereafter explained.

Negotiation.-

To negotiate a bill means to transfer it to another person, giving over to him the property thereof, and all the rights and privileges to which the holder of a bill of exchange is entitled by law.

ADVERTISEMENTS:

The transfer may be effected by delivery, or by indorsement and delivery.

All bills are transferable, except such as are special, e.g., payable to a certain person only.

Any bill which is made out as payable to bearer may pass from hand to hand, and be transferred by simple delivery; as it directs that it should be paid to whomsoever presents it for payment, when due. Bills to order instead must be indorsed before delivery.

Bills not originally transferable by simple delivery may become so through blank indorsement, and be thereupon transferable likewise by simple delivery.