Ponnappa Chetty V. Ayasamy Chetty

Present : The Hon. Sir Joseph T. Hutchinson,
Chief Justice,and Mr. Justice
Middleton.

PONNAPPA CHETTY v. AYASAMY CHETTY et al.

D. C, Kandy, 19,731.

Promissory note-Alteration of the place of making-Is it "material"?

Plaintiff sued defendant, who was a resident of Colombo, on two promissory notes, A and B, which were made at Colombo. Note A was payable at Colombo, and note B was payable at Kandy. Plaintiff before institution of action altered the word " Colombo " into " Kandy ", so as to make it appear that the notes were made at Kandy.

Held, that note A was, and that note B was not, materially altered.

Any alteration is material which would alter the business effect of the instrument if used for a business purpose.

THE facts are briefly stated in the headnote.

Van Langenberg, for the plaintiff, appellant.-The alteration in note B is not material, as the action could have been brought at Kandy, even without the alteration.

De Zoysa, for the first defendant, respondent.-If not for the alteration, the plaintiff can bring the action either at Colombo or at Kandy; after the alteration, plaintiff can bring the action only at Kandy; the alteration is clearly one which alters the business effect of the note; it is therefore a material alteration. See Suffell v. Bank of England.[1 (1882) 9 Q. B. D. 555.]

Cur. adv. vult.

June 30, 1910. HUTCHINSON C.J.-

The plaintiff sues as the endorsee of two promissory notes made by the defendants. One of the defences was that, subsequent to the making of the notes, the word " Colombo " on each of them was cancelled and the word " Kandy " put in, and the initials of the defendants were forged over the alteration, without the knowledge and authority of the defendants, and therefore no action can be maintained on the notes. The notes are on printed forms, and the word " Colombo, " signifying the place where they were made, is printed at the head, alongside the date, and has been crossed out in ink and Kandy substituted for it, with the initials of the makers.

One of the notes, marked A, was payable at the office of the National Bank of India in Colombo; the other, marked B, at the office of the same bank in Kandy. Both the defendants lived in Colombo. If, therefore, the notes were made in Colombo, the holder of note A. could only have sued on it in Colombo, but the holder of the note B could have sued on it either in Colombo, where the defendants resided, or in Kandy, where the cause of action arose.

The issues framed with reference to this defence were: (I) Were the notes made in Colombo, and not in Kandy ? (2) Was the insertion of the word " Kandy " in each of the notes unauthorized by the defendants ?

The District Judge found on both of the above issues in favour of the defendants. He also found that note A had not been duly presented for payment, and he dismissed the action. His findings of fact are not disputed, so that we are only concerned now with note B, which was duly presented for payment; and the question argued before us was whether the alteration made in it was " material " within the meaning of that word in section 64 (2) of the Bills of Exchange Act.

None of the decisions on the meaning of the word is exactly in point. In Suffell v. Bank of England,[1 (1882) 9 Q. B. D. 555.] Brett L.J. said that any alteration is material which would alter the business effect of the instrument if used for any business purpose. I think that the alteration of note A was material, because it enabled the plaintiff to sue on that note in Kandy. But I cannot see how the alteration of note B could in any way alter its business effect. Either in its original form, or as altered, the defendants could be sued on it either in Colombo or in Kandy. I hold that the alteration of note B was not material.

There was a further issue as to note B: " (4) Was the amount of note B paid by defendants to the payee and the no

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