SEGAPPA CHETTY v. MURUGAN KANGANY.

SEGAPPA CHETTY v. MURUGAN KANGANY.

C. R., Gampola, 2, 365.

 

Promissory note-Special endorsement-Eights of endorser who retires note-Right of endorser to whom a note comes back to sue maker thereon.

A promissory note made by defendant passed by a succession of endorsements to P, who specially endorsed it to the Mercantile Bank. The note on maturity was dishonored, and P paid the bank its amount, and the bank acknowledged receipt of such payment, thus: " Paid by the last endorser. Received payment " for the Mercantile Bank of India, Limited-J- B. Bishop, " Agent, " and delivered the note to P. In this state it came back to plaintiff, a prior endorser-Held, that the plaintiff had right to sue.

Held, further, that the signature on the note of the bank by its agent acknowledging payment is a sufficient endorsement by the bank, and that, coupled with delivery, gave to P all the rights and powers enjoyed by a holder in due course.

THE facts of the case appear in the judgment of Withers, J. Bawa, for appellant.

25th May, 1897. Lawrie, A. C. J. -

In my opinion the question whether the Bill of Exchange Act of 1882 deprived a mere bearer of the right to sue on a promissory note on which there are blank endorsements, but on which the last endorsement is in full to a person or firm other than the plaintiff bearer, does not arise here.

In the present case the plaintiff is not a mere bearer, he is one of the endorsers whose name appears in the note; and I have not found in the Act any provision which deprives an endorser of the right to sue the maker and the prior endorsers.

Anamala Chetty, to whom the plaintiff transferred the note by blank endorsement, endorsed it in blank to Periannen Chetty, who discounted it with the Mercantile Bank, which put on the note the stamp " Pay to the Mercantile Bank of India, or order. "

The note on maturity was dishonoured by the maker, and Periannen Chetty, the last endorser, retired it.

The bank on receiving payment endorsed it in these words: - " Paid by the last endorser; received payment for the Mercantile " Bank of India, Limited-J. B. Bishop, Agent, Kandy. "

The plaintiff avers, and for the purposes of this argument it must be taken as true, that he paid the amount to Periannen Chetty and retired the note, and he now sues on it.

It was urged that he could not sue because the bank to whom it had been endorsed had not endorsed it either in blank or specially to the plaintiff. But it seems to me that that argument is founded - on a mistake in fact.

The bank, by writing the words " Received payment from the "last endorser, received payment for the Mercantile Bank, " and. by the signature of the agent did endorse the note.

If that was an endorsement in full to Periannen Chetty, what is here wanting is not the endorsement of the bank, which is on the note, but the endorsement of Periannen Chetty; but I read the bank's endorsement as a blank endorsement, so that when the plaintiff (one of the prior endorsers) retired the note he had right to sue the maker and the endorsers prior to himself. I am unable to agree with the judgment of the District Judge of Colombo in D. C., Colombo, 9, 302, which was relied on by the appellant; the decisions of this Court reported in 2 Gren. 125, 6 S. C. C. 87, and 3 C. L. R. 33, are binding on us,

Withers, J. -

This is an action on a promissory note which is brought by an endorser against the maker. The history of the note seems to be this. The note was made on 4th April, 1893, and was payable four months after date, and the place of payment named in the note was the office of the Mercantile Bank, Limited, Kandy. The payee endorsed it in blank, and it passed by a succession of endorsements in blank to one Vena Periannen Chetty. This person seems to have discounted the note with the bank, and he signs his name in blank on the back of the note. The bank converted this blank endorsemen

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