When the name of the drawer or payee or both are fictitious, the bill is called a fictitious bill (sec. 42) . The word ‘fictitious’ means (i) a non-existing person and (ii) a pretended person, i.e., a person other than the actual person intended by the parties. Where a bill is drawn in the name of a fictitious person and payable to the drawer’s order, the acceptor is liable to pay to the order of the person who signed it as drawer.
Therefore, the endorsee can recover the amount as against the acceptor provided he is in a position to show that the signature of the supposed drawer of the bill and the first endorsement on it are in the handwriting of the same person. In case of fictitious instruments, only a holder in due course can recover the money as against the acceptor.