PART IIICheques on a Bank (continued)
Crossed Cheques (continued)
Marginal note:By drawer
Marginal note:By holder
(2) Where a cheque is uncrossed, the holder may cross it generally or specially.
(3) Where a cheque is crossed generally, the holder may cross it specially.
Marginal note:Words may be added
(4) Where a cheque is crossed generally or specially, the holder may add the words “not negotiable”.
Marginal note:By bank for collection
(5) Where a cheque is crossed specially, the bank to which it is crossed may again cross it specially to another bank for collection.
Marginal note:Changing crossing
(6) Where an uncrossed cheque, or a cheque crossed generally, is sent to a bank for collection, it may cross it specially to itself.
(7) A crossed cheque may be reopened or uncrossed by the drawer writing between the transverse lines the words “pay cash”, and initialling the same.
- R.S., c. B-5, s. 169
Marginal note:Material part
Marginal note:Altering crossing
(2) It is not lawful for any person to obliterate or, except as authorized by this Act, to add to or alter the crossing.
- R.S., c. B-5, s. 170
Marginal note:Crossed to more than one bank
171 Where a cheque is crossed specially to more than one bank, except when crossed to another bank as agent for collection, the bank on which it is drawn shall refuse payment thereof.
- R.S., c. B-5, s. 171
Marginal note:Liability for improper payment
172 (1) Subject to subsection (2), where the bank on which a cheque crossed as described in section 171 is drawn nevertheless pays the cheque, or pays a cheque crossed generally otherwise than to a bank, or, if crossed specially, otherwise than to the bank to which it is crossed or to the bank acting as its agent for collection, it is liable to the true owner of the cheque for any loss he sustains owing to the cheque having been so paid.
Marginal note:Payment in good faith and without negligence
(2) Where a cheque is presented for payment that does not at the time of presentment appear to be crossed, or to have had a crossing that has been obliterated, or to have been added to or altered otherwise than as authorized by this Act, the bank paying the cheque in good faith and without negligence shall not be responsible or incur any liability, nor shall the payment be questioned by reason of the cheque having been crossed, or of the crossing having been obliterated or having been added to or altered otherwise than as authorized by this Act, and of payment having been made otherwise than to a bank or to the bank to which the cheque is or was crossed, or to the bank acting as its agent for collection, as the case may be.
- R.S., c. B-5, s. 172
Marginal note:Protection in such case
173 Where the bank on which a crossed cheque is drawn in good faith and without negligence pays it, if crossed generally, to a bank, or, if crossed specially, to the bank to which it is crossed or to a bank acting as its agent for collection, the bank paying the cheque and, if the cheque has come into the hands of the payee, the drawer shall respectively be entitled to the same rights and be placed in the same position as if payment of the cheque had been made to the true owner thereof.
- R.S., c. B-5, s. 173
Marginal note:“Not negotiable” cross
174 Where a person takes a crossed cheque that bears on it the words “not negotiable”, he does not have and is not capable of giving a better title to the cheque than the person from whom he took it had.
- R.S., c. B-5, s. 174
Marginal note:Customer without title
175 Where a bank, in good faith and without negligence, receives for a customer payment of a cheque crossed generally or specially to itself and the customer has no title or a defective title thereto, the bank does not incur any liability to the true owner of the cheque by reason only of having received that payment.
- R.S., c. B-5, s. 175
PART IVPromissory Notes
176 (1) A promissory note is an unconditional promise in writing made by one person to another person, signed by the maker, engaging to pay, on demand or at a fixed or determinable future time, a sum certain in money to, or to the order of, a specified person or to bearer.
Marginal note:Endorsed by maker
(2) An instrument in the form of a note payable to the maker’s order is not a note within the meaning of this section, unless it is endorsed by the maker.
Marginal note:Pledge of collateral security
(3) A note is not invalid by reason only that it contains also a pledge of collateral security with authority to sell or dispose thereof.
- R.S., c. B-5, s. 176
Marginal note:Inland note
Marginal note:Foreign note
(2) Any other note is a foreign note.
- R.S., c. B-5, s. 177
178 A note is inchoate and incomplete until delivery thereof to the payee or bearer.
- R.S., c. B-5, s. 178
Marginal note:Joint and several liability
Marginal note:Individual promise
(2) Where a note bears the words “I promise to pay” and is signed by two or more persons, it is deemed to be their joint and several note.
- R.S., c. B-5, s. 179
Marginal note:Demand note presentment
Marginal note:Reasonable time
(2) In determining what is a reasonable time, regard shall be had to the nature of the instrument, the usage of trade and the facts of the particular case.
- R.S., c. B-5, s. 180
Marginal note:Endorser discharged
181 Where a note payable on demand that has been endorsed is not presented for payment within a reasonable time, the endorser is discharged but, if it has, with the assent of the endorser, been delivered as a collateral or continuing security, it need not be presented for payment so long as it is held as such security.
- R.S., c. B-5, s. 181
Marginal note:Not deemed overdue
182 Where a note payable on demand is negotiated, it is not deemed to be overdue, for the purpose of affecting the holder with defects of title of which he had no notice, by reason that it appears that a reasonable time for presenting it for payment has elapsed since its issue.
- R.S., c. B-5, s. 182
Marginal note:Presentment at particular place
Marginal note:Liability of maker
(2) In the case described in subsection (1), the maker is not discharged by the omission to present the note for payment on the day that it matures, but if any suit or action is instituted thereon against him before presentation, the costs thereof are in the discretion of the court.
Marginal note:Note payable generally
(3) When no place of payment is specified in the body of the note, presentment for payment is not necessary in order to render the maker liable.
- R.S., c. B-5, s. 183
Marginal note:Liability of endorser
Marginal note:Presentment at particular place
(2) Where a note is, in the body of it, made payable at a particular place, presentment at that place is necessary in order to render an endorser liable.
Marginal note:Presentment elsewhere
(3) When a place of payment is indicated by way of memorandum only, presentment at that place is sufficient to render the endorser liable, but a presentment to the maker elsewhere, if sufficient in other respects, shall also suffice.
- R.S., c. B-5, s. 184
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