113-NLR-NLR-V-16-JORONIS-APPU-v.-PERIS.pdf
( 481 )
Present: Pereira J. and De Sampayo A.J.
JORONIS APPU 1?. PERIS.
178—D. G. Negombo, 9,049.
BUI of exchange—Assignment otherwise than by endorsement—Rights ofassignee.
The interest in a bill of exchange or promissory note may beassigned otherwise than by endorsement. In case of such anassignment, however, the assignee is not entitled to all the rightsand privileges of a holder in due course.
T
HIS was an action on a promissory note which was made infayour of the plaintiff and another. The second payee
transferred his interest in the note to the plaintiff by a separatewriting. The District Judge dismissed the action, holding that thenote could only be transferred by endorsement.' The plaintiff
appealed.
*9 C. A. C, 88.
3 (1906) 10 N. L. R. 44.
1913.
* 18. C. D. 67.
ma.
Joronis
Appuv.
Pern
( 482 )
F. M. de Saram, for the appellant.—The District Judge wasclearly wrong in the view he has taken of the law. A promissorynote can be transferred otherwise than by mere endorsement. TheBills of Exchange Act, 1882 (section 31), contemplates such atransfer. A promissory note is a chattel and a chose in action, midcan be transferred in the same manner as a chattel or chose in actionis transferred. The English law applies to bills of exchange and.promissory notes, and an assignment of a promissory note bywriting is effectual to pass title to it. (Garpen Chetty v, Sanmugam,Tever.1)
Arulfinandam, for the respondent.—The law with regard to bills ofexchange has been codified, and the Bills of Exchange Act of 1882contains the whole of the law on the subject. The Act nowhereexpressly provides for assignments otherwise than by endorsement.
Cur. adv. vult.
July 1, 1913. Pereira J.—
I see no reason to disagree with the District Judge in the conclu-sions he has arrived at on the second, third, and fourth issues. Theonly question that remains to be considered is that involved in thefirst issue, namely, whether the assignment referred to is valid in law.The District Judge seems to think that a promissory note cannotbe assigned except by endorsement. I do not think he is right here.It is well-established law that although bills and notes partakelargely of the nature of money, yet they retain also their innatecharacter of chattels and choses in actions. As chattels they maybe bought and sold, and as choses in action they may be assigned.The interest in a bill or note can be assigned otherwise than theendorsement, although, of course, the assignee will not be in theadvantageous position of a “ holder in due course ” as against whomcertain defences that the maker may have against the immediatepayee may not be available to him. The Bills of Exchange Act,1882 (45 & 46 Vic. ch. 61), itself recognizes the right to transferbills and notes without endorsement. In section 81 (4) it enactsthat where the holder of a bill payable to his order transfers it forvalue without endorsing it, the transfer gives the transferee suchtitle as the transferor had in the bill, and the transferee, in addition,acquires the right to have the endorsement of the transferor. Thetransferee may not exercise this right,' but still the rights conveyedto him remain unaffected. It is said that he will be well advisedto obtain the indorsement to him of the transferor, because, shouldthe instrument remain in the latter’s possession after the sale orassignment, an indorsement by him, though later in date, to aholder who takes it for value and without notice will give suchholder a complete title to the instrument. Anyway the assignment
i (1884) 6 5. C. C. 40.
1918.
( 438 )
by itself is operative as such. The terms of the document reliedon in this case as an assignment appear to me to be sufficient togive the document the effect of an assignment. The very word“ assigned ” is used in it.
I would set aside the judgment appealed from and enter judgmentfor plaintiff as claimed with costs.
De Sampayo A. J.—
I agree. The District Judge was clearly wrong in thinking thata promissory note could not be assigned otherwise than by endorse-ment. In Garpen Chetty v. Sanmugam Tever 1 it was held that theEnglish law applied to the matter, and that since the EnglishJudicature Act, 1873, an assignment of a promissory note bywriting was effectual to pass title to it and the legal remedies thereon.The only question in this case appears to me to be whether thewriting granted to the plaintiff by the other payee is sufficient asan assignment. The District Judge regarded it as nothing morethan a mere receipt. I think there he was wrong. The documentin question is not a deed or a notarial instrument, but is a more orless formal writing, and contains sufficient words of assignment.The Judicature Act only required a writing. In Marchant v. Morton,Down & Co.3 the document was a deed signed only by one memberof a partnership, and therefore did not bind the firm as a deed, butit was upheld as a good assignment in writing, Channell J. observingthat a deed was not necessary. No other objection being raised tothe form of the assignment, I think the plaintiff is entitled tojudgment.
Set aside.
Pbwhua J.
JoronisAppu t>.Peris
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i (1884) € 8. C. C. 40.
33-
* (1901) 2 E. B. 829.