[1938] EACA 180

## ORIGINAL CIVIL

#### Before SIR JOSEPH SHERIDAN, C. J.

### HARMANBHAI D. PATEL, Plaintiff

v.

# MAWJI GOVIND, Defendant Civil Case No. 143 of 1939.

Negotiable instrument—Promissory note not made payable at any particular place—Action against indorser—Necessity for presentment—Bills of Exchange Ordinance, 1927, sections 45 and 87.

Plaintiff as holder of an overdue promissory note sued the defendant as indorser. The promissory note which was not made payable at any particular place had not been presented for payment.

Held (21-11-39) — That presentment for payment is necessary to make an<br>indorser of a promissory note liable thereon even though it is not specified in the body of the note that payment shall be made at a particular place.

(The case is only reported on the point of necessity for presentment<br>though the case also failed on other grounds appearing in the judgment which is printed in toto.)

#### Mangat for the Plaintiff.

Shapley and Trivedi for the Defendant.

JUDGMENT.—The following passage in Gibb v. Mather and Others, 149, E. R. 110 at 113, disposes of the contention that presentment was unnecessary: "It is the acceptor of a bill and the maker of a note who are primarily liable to the holder and the drawer of the bill like the indorser of the note does not become liable until there has been a due presentment made to the party liable in the first instance to pay the bill." In the present case although it was pleaded that there had been presentment and it was at first argued that there had been presentment counsel for the plaintiff could not sustain the contention and I find that there was no presentment. The argument then put forward was that as no particular place had been specified in the body of the note presentment was unnecessary. This argument failed to appreciate the distinction between the liability of a maker and that of an indorser. The words of section 87 (2) of the Bills of Exchange Ordinance are: "Presentment for payment is necessary in order to render the indorser of a note liable." Because section 87 (1) provides that presentment is unnecessary in order to render the maker of a note liable where it is not provided in the body of the note that payment shall be made at a particular place, that does not affect the case of an indorser expressly provided for by section 87 (2). Next comes section 45 which sets out the rules governing presentment for payment. A perusal of these rules and particularly the rule embodied in section 45 (4) (b), (c) and (d) will show that presentment is required where no place of payment is specified, presentment not to render the maker liable, for section 87 (1) provides for that case, so it must refer to a case like the present where it is sought to make the indorser liable. The case of Walji Hirji and Sons v. Cassam Noor Mohamed, 10 K. L. R. 103, was relied on for the plaintiff but that case only serves to illustrate the distinction between the case of a maker

and an indorser where presentment for payment is concerned. Presentment to the maker not having been made and presentment being necessary before the indorser can be made liable, this action must fail.

Although what I have already said disposes of the case I will now proceed to the question as to whether this transaction was a moneylending one and if so what are the consequences so far as the plaintiff is concerned.

Evidence was led for the defendant including his own evidence that the transaction in question was of a moneylending nature and other transactions said to be of that nature have been spoken to. In the case of the particular transaction the defendant said that he had recourse to two other moneylenders who refused to negotiate the transaction before going to Kassam Kanji. Kassam Kanji, it has been proved, was a director in a moneylending firm known as United Agencies, at the time in question, and in the same building and the same room in that building there were carried on the business of United Agencies and Kassam Kanji's cycle business. A prima facie case that the transaction was a moneylending one has been made out and in the absence of contradictory evidence or evidence of additional facts on the part of the plaintiff which at least would have the effect of raising a real doubt as to whether the transaction was a moneylending one or not, I hold that the transaction was a loan by Kassam Kanji as a moneylender. On that finding it follows from sections 10, 17 and 20 of the Moneylenders Ordinance that the case must fail. Section 10 refers to the form of moneylenders contracts and in this case the statutory form was not complied with, thus rendering the contract unenforceable. Section 17 prescribes the period within which proceedings may be commenced and the period was much exceeded in this case. Section 20 refers to the position of assignees.

The evidence establishes that the plaintiff was not the holder of the note at the time of maturity and so the provisions of section 36 (2) of the Bills of Exchange Ordinance apply. They read:-

"Where an overdue bill is negotiated, it can only be negotiated subject to any defect of title affecting it at its maturity, and thenceforward no person who takes it can acquire or give a better title than that which the person from whom he took it had."

As the moneylender could not have recovered on the note, so also with the plaintiff who did not become the holder of it before it was overdue.

The action therefore fails and is dismissed with costs including the costs of the application giving leave to defend.

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