012-NLR-NLR-V-40-ADAIKAPPA-CHETTY-v.-LETCHUMAN-CHETTY.pdf
Adaikappa Chetty v. Letchuman Chetty.
49
1968
Present: Maartensz and Koch JJ.ADAIKAPPA CHETTY v. LETCHUMAN CHETTY.290—D. C. Negombo, 10,207.
Promissory Note—Document with an account followed by promise to paybalance due—Payee indicated with reasonable certainty—Restrictive en-dorsement—Bills of Exchange Ordinance, No. 25 of 1927, s. 35 (1).
A document was drawn up in the following terms:—Credit of PanaLana Nawanna Suna Pana of Negombo. Debit of Ana Nana TheeannaLayna of the above place. Then followed a statement of accountsshowing that on a certain date a sum of Rs. 3,525 was due and a promiseto pay “ to your order on demand Rs. 3,525,with interest at $ per cent,per month ”. It was signed A. N. T. L. Letchuman. On the reverse sideof the document were the following words:—The principal and interestherein mentioned shall be collected from the therein signed Ana NanaTheeanna Layna by Rawanna Mana Adaikappa Chettiar. (Signed) P. L.N. S. P. Suppramaniam.
Held, that the document was a promissory note and that the payee wasindicated with reasonable certainty.
Held, further, that the endorsement was a restrictive endorsementwithin the meaning of section 35 (1) of the Bills of Exchange Ordinance,No. 25 of 1927.
HIS was an action on a promissory note brought by the plaintiff as
X endorsee against the defendant, the maker of the note. TheDistrict Judge gave judgment for the plaintiff. The main questionargued in appeal was whether the document the terms of which are setout in the head-note was a promissory note.
N. E. Weerasooria (with him W. W. Mutturajah and H. A. Chandra-sena), for defendant, appellant.—The document sued upon has thecharacteristics not of a promissory note but merely of an account stated.The action is therefore barred by prescription. The payee is neithernamed nor adequately indicated by the letters P. L. N. S. P. There isalso no proper endorsement but a mere written promise or direction (onthe reverse side of the document) that the money “ shall be collected ”by a certain person. These facts seems to indicate that it was not theintention of the parties to make a promissory note at all but a merewritten memorandum only of some obligation based upon a looking intoof accounts between them. The holder of a note into whose hands itmay lawfully come should be able to say without further inquiry who isliable to be sued upon the note. Every bill of exchange or promissorynote should be upon the face of it, a contract complete in itself. Even ifthe document has some or all of the properties of a valid note, it is theintention of the parties to create the obligations arising upon a promissorynote that determines the true nature of the document—see Sibbree v.
N. Nadarajah (with him G. E. Chitty), for plaintiff, respondent.—Everyrequirement of the Bills of Exchange Ordinance necessary for the creation ofa valid promissory note is satisfied by the terms of the document sued upon..
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KOCH J.—Adaikappa Chetty v. Letchuman Che tty.
As regards the payee’s name it-is only necessary that the payee should beindicated with reasonable certainty. See section 7 (1) of the Bills ofExchange Ordinance. Particularly among the Natucottai Chettiarswho ate admittedly the parties to this transaction, it is commonto use the initials alone to designate a party. The endorsement thoughusually by. a signature only, does not become invalid by reason of the useof additional words. At lowest there is here a restrictive indorsement. contemplated by the Ordinance. See section 35 (1) of the Act. Even amere agent for collection who is a holder can sue. See Halsbury (Hailshamed.), vol. II., p. 657. Even if a wrong name has been given to the payee it canbe shown whom the parties intended. See Willis v. Barrett1. See alsothe case of Green v. Davis The defendent here has actually admitted■that the person referred to was Suppramaniam Chettiar. That the•document was intended as a promissory note seems further to be indicatedby the fact that it has been stamped as such (viz.', with a six-cents stamp).The action as on a promissory note would not be statute-barred in lessthan six years and the plaintiff is therefore in time.
Cur. adv. vult. ■ ■
July 13,-1938. Koch J.—
The plaintiff, as endorsee, sued on a document which he alleged was apromissory note made by- the defendant. There was no defence on themerits. The learned District Judge entered judgment for the plaintiff.The defendant has appealed.
The argument put forward on behalf of the appellant was confined totwo points, namely—
that the document sued • upon is not a promissory note for tworeasons: — (a) that the name of the payee does not appear nor has thepayee been indicated with reasonable certainty, and (b) that in otherrespects the document does not conform to the requirements necessary toconstitute' it a promissory note; and
that if the document is found to be a promissory note, the endorse-ment is defective and does not give the plaintiff a right to sue.
The document is in Tamil and it was agreed that the translation D6should be accepted as correct.
. Mr. Weerasooria’s argument is that the document can only be regardedas an account stated coupled with a promise to pay.
Now, assuming for the purposes of the argument that the document isan account stated, each of the parties to. it must have known who theother was. The document commences with the words, “ Credit of PanaLana Nawanna Suna Pana of Negombo, debit of Ana Nana TheeannaLayna of the above place ”. Then follow the words referring to a paymentof Rs. 3,000 and stating that the balance on this day the 1st day of April,1934, was Rs. 3,525. Immediately after -this are the words, “ I shall payto your order on demand the said “ sum of Rupees Three thousand Fivehundred and Twenty-five together with interest thereon at h per centumper month and take back this letter”. The document is signed byA. N. T. L. Letchuman, the defendant. This shows that the words,“debit of ”, were regarded as meaning debtor and the initials, Ana Nana» (1816) 2 Stark 29.= 4 B. & Cr. 235.“
KOCH J.—Adaikappa Che tty v. Letchuman Che tty.51
Theeana Layna, referred to Letchuman. Applying the same reasoning,the words, “credit of”, should be regarded as meaning creditor and theinitials, P. L. N. S. P., must have been intended by the signatory to alsorefer to the individual who was known by these initials. It is a commonpractice among Chetties to refer to a member of their community by hisinitials which he obtains from his father’s name, and sometimes from hisgrandfather’s name as well.
Two cases, namely, Green v. Davis' and Sibbree v. Tripp *, were cited,the latter by the appellant’s and the -former by the respondent’s Counsel.I do not think that it is necessary to comment on either of these decisionsas the language in the documents dealt with in those cases was differentfrom that in the document before us.
Section 7 (1) of the Bills of Exchange Act, 1882, runs:—“ Where a billis not payable to bearer, the payee must be named or otherwise indicatedwith reasonable certainty
In Willis v. Barrett the bill was payable to “ the order of J. Smythe ”.It was held that evidence was admissible to show that -J. Smith wasintended to be described thereby.
I cannot therefore see why in the case before us, in a transactionbetween Chetties where in the document a Chetty is referred to anddescribed by his initials by another Chetty, extrinsic evidence cannot beled to show who the individual described was intended to be. I thereforehold that the payee on the document sued upon has been indicated withreasonable certainty. Moreover, it is admitted that the person referredto was Suppramaniam Chettiyar—vide paragraph .3 of the answer.
On the next point, I am of opinion that the words I have quoted fromthe document read in conjunction with the context contain all the neces-sary essentials of a promissory note, and that it was intended by theparties that the document should operate as a note, the payee beingP. L. N. S. P.
The value of the stamp which has been affixed is six cents—just whatis necessary for an “ on demand ” note. Had the document been intendedto be an account stated, the stamp value would have been considerablyhigher. The words, “ pay to your order ”, mean “ pay to you or to yourorder ”. In Willis v. Darrett (supra), the words were, “ to the order ofSmythe ”, and it was held that the document was a bill.
The remaining point is whether the endorsement is in order.
On the reverse side of the document are the words, “ the principal andinterest herein-mentioned shall be collected from the therin signedAna Nana Theeanna Layna by Rawanna Man a Adikappa Chettiar ofNattarasankottai ”, and immediately below this is the signature ofP. L. N. S. P. Suppramaniam.
Now, the Bills of Exchange Act to which I hve referred provides forvarious kinds of endorsements and one of them is what is lmown as “ arestrictive endorsement ”. Section 35 (1) refers to such a type ofendorsement and defines it as one inter alia which expresses that it is a
» 4 B. A Cr. 235.* 15 M. £ W. 23.
a (1816) 2 Stark 29.•
52
MAARTENSZ S.PJ.—Joseph v. Sugatadasa.
mere authority to deal with the bill as directed, e.g., for collection. Sub-section (2) states that a restrictive endorsement gives the endorsee theright to receive payment on the bill and to sue any party that the endorsercould have sued.
. f therefore hold that the bill has been duly endorsed by the payee as arestrictive endorsement and that the endorsee for collection is Raw annaMana Nana Rawanna Mana Adaikappa Chettiar, who can rightly sue.He is the plaintiff in the case. I wish to point out that in this endorse-ment Letchuman Chetty, the maker, is referred to only by his initials,once again showing the Chetty practice of. referring to a member of thecommunity by his initials.
The appeal is. dismissed' with costs.
Maartensz J.—I agree.
Appeal dismissed.