Section 53-58 Nigerian Bill of Exchange Act LFN 1990

Section 53-58 Bill of Exchange Act 1990

Section 53, 54, 55, 56, 57, 58 of the Bill of Exchange Act [Laws of the Federation of Nigeria 1990] is under Part II [Bills of Exchange – Liabilities of Parties] of the Act.

Section 53 Bill of Exchange Act 1990

(Bill not assignment of funds in hands of drawee)

A bill, of itself, does not operate as an assignment of funds in the hands of the drawee available for the payment thereof, and the drawee of a bill who does not accept as required by this Act is not liable on the instrument.

Section 54 Bill of Exchange Act 1990

(Liability of acceptor)

The acceptor of a bill by accepting it –

(a)            engages that he will pay it according to the tenor of his acceptance;

(b)            is precluded from denying to a holder in due course –

(i)             the existence of the drawer, the genuineness of his signature, and his capacity and authority to draw the bill,

(ii)            in the case of a bill payable to drawer’s order, the then capacity of the drawer to endorse, but not the genuineness or validity of his endorsement,

SEE ALSO  Section 69-72 Nigerian Bill of Exchange Act LFN 1990

(iii)           in the case of a bill payable to the order of a third person, the existence of the payee and his then capacity to endorse, but not the genuineness or validity of his endorsement.

Section 55 Bill of Exchange Act 1990

(Liability of drawer or endorser)

 (1)            The drawer of a bill by drawing it –

(a)            engages that on due presentment it shall be accepted and paid according to its tenor, and that if it be dishonoured he will compensate the holder or an endorser who is compelled to pay it, provided that the requisite proceedings on dishonour be duly taken;

(b)            is precluded from denying to a holder in due course the existence of the payee and his then capacity to endorse.

(2)            The endorser of a bill by endorsing it-

(a)            engages that on due presentment it shall be accepted and paid according to its tenor, and that if it be dishonoured he will compensate the holder or a subsequent endorser who is compelled to pay it, provided that the requisite proceedings on dishonour be duly taken;

(b)            is precluded from denying to a holder in due course the genuineness and regularity. in all respects of the drawer’s signature and all previous endorsements; (c) is precluded from denying to his immediate or a subsequent endorsee that the bill was at the time of his endorsement a valid and subsisting bill, and that he had then a good title thereto.

Section 56 Bill of Exchange Act 1990

(Stranger signing bill liable as endorser)

Where a person signs a bill otherwise than as a drawer or acceptor, he thereby incurs the liabilities of an endorser to a holder in due course.

SEE ALSO  Section 39-45 Nigerian Bill of Exchange Act LFN 1990

Section 57 Bill of Exchange Act 1990

(Measure of damages against parties to dishonoured bill)

Where a bill is dishonoured, the measure of damages, which shall be deemed to be liquidated damages, shall be as follows �

(a) the holder may recover from any party liable on the bill, and the drawer who has been compelled to pay the bill may recover from the acceptor, and an endorser who has been compelled to pay the bill, may recover from the acceptor or from the drawer, or from a prior endorser–

(i) the amount of the bill,

(ii) interest thereon from the time of presentment for payment if the bill is payable on demand, and from the maturity of the bill in any other case,

(iii) the expenses of noting, or when protest is necessary, and the protest has been extended, the expenses of protest;

(b) in the case of a bill which has been dishonoured abroad, in lieu of the above damages, the holder may recover from the drawer or an endorser, and the drawer or an endorser who has been compelled to pay the bill may recover from any party liable to him, the amount of the re-exchange with interest thereon until the time of payment;

(c) where by this Act interest may be recovered as damages, such interest may, if justice require it, be withheld wholly or in part, and where a bill is expressed to be payable with interest at a given rate, interest as damages may or may not be given at the same rate as interest proper.

SEE ALSO  Section 78-84 Nigerian Bill of Exchange Act LFN 1990

Section 58 Bill of Exchange Act 1990

(Transferor by delivery and transferee)

(1)            Where the holder of a bill payable to bearer negotiates it by delivery without endorsing it, he is called a transferor by delivery.

(2)            A transferor by delivery is not liable on the instrument.

(3)            A transferor by delivery who negotiates a bill thereby warrants to his immediate transferee being a holder for value that the bill is what it purports to be, that he has a right to transfer it, and that at the time of transfer he is not aware of any fact which renders it valueless.


Credit: CommonLII

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