015-NLR-NLR-V-70-D.-P.-WIJESUNDERA-Appellant-and-T.-P.-KUNJIMOOSA-CO.-and-another-Respondent.pdf
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SIRIMANE, J.— Wijesundera v. Kunjimoosa ds (Jo.
1967 Present: H. N. G. Fernando, C.J., and Sirlmane, J.
D. P. WIJESUNDERA, Appellant, and T. P. KUNJIMOOSA& CO. and another, Respondents
8. G. 481 j 64—D. C. Kandy, 7 101J 8
Cheque—Notice of dishonour— Circumstances when it can and cannot be dispensed with—Bills of Exchange Ordinance (Cap. 82), ss. 49 (12), 50 (2) (c) (v).
Where a cheque when presented for payment is dishonoured because “ effectswere not cleared ”, an indorser of the cheque must be given due notice ofdishonour before he can be sued. In such a case section 50 (2) (c) (v) does notdispense with notice of dishonour.
.A. P P E A L from a judgment of the District Court, Kandy.
A. G. Gooneratne, Q. G., with R. Gooneratne, for the 1st defendant-appellant.
Ranganathan, Q. G., with V. E. Selvarajah, for the plaintiff-respondent.
Gur. adv. wit.
June 9, 1967. Sirimane, J.—-
This was an action filed by the plaintiff company against the twodefendants for the recovery of a sum of Rs. 2,000 which they alleged wasdue to them on two cheques marked “ A ” and “ B ”.
Cheque “ A *' was for a sum of Rs. 1,000 drawn by the 1st defendantin favour of the 2nd defendant. Cheque “ B ” was also for a similar sumdrawn by an unknown person but endorsed by the 1st defendant to the2nd defendant. The 2nd defendant had qbtained cash on both thesecheques from the plaintiff company. When presented for payment bothcheques were dishonoured.
£IRIMANE, J.—Wijesundera v. Kunjimooaa <Se Co.
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The learned District Judge has entered judgment against the twodefendants and the 1st defendant has appealed.
The only point urged in appeal was that there was no notice ofdishonour given to the 1st defendant within a reasonable time asrequired by the Bills of Exchange Ordinance (Cap. 82).
Section 49 (12) of that ordinance provides that :
“ The notice may be given as soon as the bill is dishonoured, and
must be given within a reasonable time thereafter.
In the absence of special circumstances notice is not deemed to have
been given within a reasonable time, unless—
(o)where the person giving and the person to receive notice reside inthe same place, the notice is given or sent off in time to reachthe latter on the day after the dishonour of the bill;
where the person giving and the person to receive notice reside indifferent places, the notice is sent off on the day after thedishonour of the bill, if there be a post at a convenient hour onthat day, and if there be no such post on that day then by thenext post thereafter.”
The cheque “A” was dishonoured on 3.4.62 and cheque “ B ” on
Notice of dishonour is a condition precedent to a right ofaction against an indorser or a drawer.
Such a notice was sent to the 1st defendant in respect of both chequesnearly a month later, viz., on 11.6.62 by letter P3. There was no notice,therefore, as required by the section quoted above nor were there anyspecial circumstances to excuse such a notice.
In respect of cheque “A ”, however, payment was stopped by thedrawer (1st defendant).
Under Section 50 (2) (c) (v) of the Bills of Exchange Ordinance, noticeof dishonour is dispensed with when the drawer countermands payment.
The argument in regard to lack of due notice of dishonour, therefore,does not apply to cheque “A ”, but it is entitled to succeed in regard tocheque “ B ”. That cheque was not drawn by the 1st defendant andwas dishonoured because “ effects were not cleared ”, to quote theendorsement made on it by the bank.
The learned District Judge in answering the issue relating to duenotice of dishonour had overlooked this fact, and wrongly decided thatthe 1st defendant was not entitled to notice in respect of both cheques onthe ground that he had countermanded payment.
The 2nd defendant has not appealed against the judgment. In fact,at the trial he had given evidence which favoured the plaintiff’s case andstated in the course of that evidence : “ When the two cheques weredishonoured, the plaintiffs came and saw me and they asked me to givethem the money due on the cheques. ”
66MANICAVASAGAB, J.—The Queen v. Karthenis de Silva
The judgment against him must therefore stand.
We vary the judgment and decree in respect of the 1st defendant onlyby entering judgment against him for a sum of Rs. 1,000 with legalinterest thereon from date of action, and costs in the lower court.
As both parties have partially succeeded here, there will be no costs ofappeal.
N. G. Fernando, C.J.—I agree.
Appeal partly allowed.