[1933] EACA 8

[1933] EACA 8

The court found that the insertion of the words 'Payments guaranteed by me' after the defendant's endorsement constituted a material alteration of the promissory notes without the defendant's knowledge or consent. This alteration vitiated the instrument and discharged the defendant from liability as an endorser. Furthermore, the plaintiffs failed to establish a separate contract of guarantee apart from the promissory notes. As the notes were not endorsed over to holders in due course, the defendant's potential liability as an endorser never arose. The action was dismissed with costs awarded to the defendant.

Citation
[1933] EACA 8
Parties
Plaintiff: Karimjee Jivanjee and Co.; Defendant: Alibhai Mohamed Dhanjee
Court
East African Court of Appeal
Jurisdiction
Uganda
Judgment Date
1 January 1933
Case Number
C.C. 47/1932 (Mombasa).
Procedural Posture
Civil Suit / Judgment
Outcome
action dismissed
Judges
Dickinson, J
Legal Topics
Bills of Exchange, Material Alteration, Endorsement Liability, Guarantee on Promissory Note
Source Language
English
Commercial and Corporate Civil Procedure Bills of Exchange Material Alteration Endorsement Liability Guarantee on Promissory Note

Case Brief

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Parties

Karimjee Jivanjee and Co.

Plaintiff

Alibhai Mohamed Dhanjee

Defendant

Procedural Posture

Civil Suit / Judgment

Legal Issues

  1. 1 Whether the insertion of 'Payments guaranteed by me' after endorsement constitutes a material alteration of the promissory notes.
  2. 2 Whether the defendant is liable as an endorser or guarantor to the plaintiffs under the altered promissory notes.
  3. 3 Whether the plaintiffs can claim against the defendant under a separate contract of guarantee apart from the promissory notes.

Ratio Decidendi

The court found that the insertion of the words 'Payments guaranteed by me' after the defendant's endorsement constituted a material alteration of the promissory notes without the defendant's knowledge or consent. This alteration vitiated the instrument and discharged the defendant from liability as an endorser. Furthermore, the plaintiffs failed to establish a separate contract of guarantee apart from the promissory notes. As the notes were not endorsed over to holders in due course, the defendant's potential liability as an endorser never arose. The action was dismissed with costs awarded to the defendant.

Court Disposition

action dismissed

Orders

  • The action is dismissed with costs awarded to the defendant.