1923_BILLS_OF_EXCHANGE_ORDINANCE__1885 — Page 12

292

No. 3 of 1885.

BILLS OF EXCHANGE.

Negotiation of bill.

Requisites of valid indorsement.

Negotiation of bill.

31 (1) A bill is negotiated when it is transferred from one person to another in such a manner as to constitute the transferee the holder of the bill.

(2) A bill payable to bearer is negotiated by delivery.

(3) A bill payable to order is negotiated by the indorse- ment of the holder completed by delivery.

(4) Where the holder of a bill payable to his order transfers it for value without indorsing it, the transfer gives the transferee such title as the transferor had in the bill, and the transferee in addition acquires the right to have the indorse- ment of the transferor.

(5) Where any person is under obligation to indorse a bill in a representative capacity, he may indorse the bill in such terms as to negative personal liability.

32. An indorsement in order to operate as a negotiation must comply with the following conditions, namely,-

(1) it must be written on the bill itself and be signed by the indorser. The simple signature of the indorser on the bill, without additional words, is sufficient. An indorsement written on an allonge, or on a "copy" of a bill issued or negotiated in a country where "copies" are recognised, is deemed to be written on the bill itself;

(2) it must be an indorsement of the entire bill. A partial indorsement, that is to say, an indorsement which purports to transfer to the indorsee a part only of the amount payable, or which purports to transfer the bill to two or more indorsees severally, does not operate as a negotiation of the bill;

(3) where a bill is payable to the order of two or more payees or indorsees who are not partners, all must indorse, unless the one indorsing has authority to indorse for the others;

(4) where, in a bill payable to order, the payee or indorsee is wrongly designated or his name is mis-spelt, he may indorse the bill as therein described, adding, if he thinks fit, his proper signature;

(5) where there are two or more indorsements on a bill, each indorsement is deemed to have been in the order in which it appears on the bill, until the contrary is proved;