( 377 )
CHITAMBABAM CHETTY v. VA«,v AOAJM.C. B., Colombo, 20,716.1002.
Promissory note—Signing of blank printed form—Duty of payee to fill upstrictly in accordance with the authority given—Bills of Exchange Act,s. 20.
V A, having signed a blank printed form of a promissory note dulystamped as for a note payable on demand, gave it to M G for valuereceived by him. In an action brought by 0 C against Y A upon thisnote, which purported to have been signed in his own favour,—
Held that, as the note was not filled up strictly in accordance with theauthority given by V A to M C, and was not- negotiated to the plaintiffbefore it became due for value and without notice of the defect, thedefendant was entitled to show the true facts of the case and deny hisliability to the plaintiff.
HE facts of the case appear in the judgment of Wendt, J.The appeal was heard on the 27th October, 19Q2.
H. Jayawardene, for plaintiff, appellant.
Wadsworth, for respondent.
Cur adv. vult.
( 878 )
17th November, 1902. Wendt, J.—
The plaintiff sues on a promissory note in his own favoursigned by the defendants for the sum of Rs. 225. The defence,which the Commissioner has upheld, was that the defendantssigned a blank printed form of note duly stamped as for a notepayable on demand, and gave it to one Muttu Caruppen Chetty, whohad lent them the Rs. 100 forming the consideration of the note,and that he had authority only to dll it up in his own favour, andfor such sum of the Rs. 100 as should remain due. Thedefendants denied any knowledge of plaintiff in connection withthe transaction, and denied their liability for the sum claimed, asthe note had been fraudulently filled up in plaintiff’s favour and■for the sum of Rs. 225. Plaintiff’s account of the matter was' thathe had himself lent the defendants the sum of Rs. 225, and theyhad signed the note after it had been fully written out as it nowstands.
The Commissioner found the facts in defendants’ favour as Ihave stated them, and I have no reason to think that he was wrong.Upon that finding he was right in dismissing the action. This beingithe case of a promissory note, section 20 of the Bills of ExchangeAct applies. Assuming plaintiff was the payee intended by themakers, sub-section 2 enacts that in order that the blank instrumentwhen completed may be enforceable against any person who (likethe makers) became party thereto prior to its completion, it .mustbe filled' up strictly in accordance with the authority given. The .‘exception is' where such a note after completion. is negotiated to aholder in due course, that is, one who takes the note before it isdue, for value and without notice of the defect. Plaintiff’s caseis that he was the payee intended by the makers, and that thenote was deliberately made by them in his favour. He cannotbe heard to say that he is entitled to recover by reason of theexception, as though he were a holder in due course. Even if hecould be heard to set that up, the facts disprove his claim. Therewas no negotiation to him (see the definitions in sections 31 and29 of the Act of the terms “ negotiation ” " and holder in duecourse ”).
Appellant’s counsel relied on the case of Union Credit Bank v.Mersey Docks and Harbour Board (68 L.J., Q. B. 843), where theparty signing a blank delivery order was held estopped from dis-puting the act of the person whom he had authorized to fill it up.But in the first place such estoppels, in the case of negotiableinstruments, are in my opinion provided' for by section 20 of theAct, and in the next place the facts of the two cases are not similar.
( 379 )
In the English case the plaintiffs, the persons entitled to the goods 1802.warehoused with defendants, owed the defendants ^a duty—the November 17
duty of filling up the delivery order form with such particulars.'
£6 should guide the defendants in delivering the goods, and in the Wendt, J.discharge of that duty they signed an order form expresslydirected to the defendants, and intending that the defendantsshould receive and act upon it, as they in fact did. The ordercontained a blank where the quantity of the goods should have beenspecified, and this blank the plaintiffs authorized Nicholls to fillup by staring a particular quantify. He filled it up with a largerquantify, presented it to defendants, and obtained the goods whichhe made away with. The action was in trover against thedefendants for the excess of the goods. Plaintiffs were heldestopped from showing the limitation on Nicholls’ authority. Inthe present case the defendants owed no duly to plaintiff, signedno document addressed to him or intended to be acted on by him.
Plaintiff was a complete stranger, and he took a note in his favourfor which he had given the makers no consideration whatever, andI think that as against him the defendants are entitled to showthe true facts.
The appeal is dismissed.
CHITAMBARAM CHETTY v. VARA ASARI