Bills of Exchange Act
- Assented to on 24 July 1967
- Commenced on 28 July 1967
- [This is the version of this document at 31 December 2014.]
- [Note: This version of the Act was revised and consolidated in the Fifth Revised Edition of the Laws of Malawi (L.R.O. 1/2018), by the Solicitor General and Secretary for Justice under the authority of the Revision of the Laws Act.]
Part I – Preliminary
1. Short titleThis Act may be cited as the Bills of Exchange Act.
2. InterpretationIn this Act, unless the context otherwise requires—“acceptance” means an acceptance completed by delivery or notification; “action” includes counter claim and set off;“banker” includes a body of persons whether incorporated or not who carry on the business of banking;“bankrupt” includes any person whose estate is vested in a trustee or assignee under the law for the time being in force relating to bankruptcy;“bearer” means the person in possession of a bill or note which is payable to bearer;“bill” means bill of exchange, and “note” means promissory note; “delivery” means transfer of possession, actual or constructive, from one person to another;“holder” means the payee or indorsee of a bill or note who is in possession of it, or the bearer thereof;“indorsement” means an indorsement completed by delivery;“issue” means the first delivery of a bill or note, complete in form to a person who takes it as a holder;“value” means valuable consideration;“written” includes printed, and “writing” includes print.
Part II – Bills of exchange
Form and interpretation
3. Bill of exchange defined
4. Inland and foreign bills
5. Effect where different parties to bill are the same person
6. Address to drawee
7. Certainty required as to payee
8. What bills are negotiable
9. Sum payable
10. Bill payable on demand
11. Bill payable at a future time
12. Omission of date in bill payable after dateWhere a bill expressed to be payable at a fixed period after date is issued undated, or where the acceptance of a bill payable at a fixed period after sight is undated, any holder may insert therein the true date of issue or acceptance, and the bill shall be payable accordingly:Provided that—
13. Ante-dating and post-dating
14. Computation of time of paymentWhere a bill is not payable on demand the day on which it falls due is determined as follows—
15. Case of needThe drawer of a bill and any endorser may insert therein the name of a person to whom the holder may resort in case of need, that is to say, in case the bill is dishonoured by non-acceptance or nonpayment. Such person is called the referee in case of need. It is in the option of the holder to resort to the referee in case of need or not as he may think fit.
16. Optional stipulations by drawer or indorserThe drawer of a bill, and any indorser, may insert therein an express stipulation—
17. Definition and requisites of acceptance
18. Time for acceptance
19. General and qualified acceptances
20. Inchoate instruments
Capacity and authority of parties
22. Capacity of parties
23. Signature essential to liabilityNo person is liable as drawer, indorser, or acceptor of a bill who has not signed it as such:Provided that—
24. Forged or unauthorized signatureSubject to this Act, where a signature on a bill is forged or placed thereon without the authority of the person whose signature it purports to be, the forged or unauthorized signature is wholly inoperative, and no right to retain the bill or to give a discharge therefor or to enforce payment thereof against any party thereto can be acquired through or under that signature, unless the party against whom it is sought to retain or enforce payment of the bill is precluded from setting up the forgery or want of authority:Provided that nothing in this section shall affect the ratification of an unauthorized signature not amounting to a forgery.
25. Procuration signaturesA signature by procuration operates as notice that the agent has but a limited authority to sign, and the principal is only bound by such signature if the agent in so signing was acting within the actual limits of his authority.
26. Person signing as agent or in representative capacity
The consideration for a bill
27. Value and holder for value
28. Accommodation bill or party
29. Holder in due course
30. Presumption of value and good faith
Negotiation of bills
31. Negotiation of bill
32. Requisites of a valid indorsementAn indorsement in order to operate as a negotiation must comply with the following conditions, namely:—
33. Conditional indorsementWhere a bill purports to be indorsed conditionally the condition may be disregarded by the payer, and payment to the indorsee is valid whether the condition has been fulfilled or not.
34. Indorsement in blank and special indorsement
35. Restrictive indorsement
36. Negotiation of overdue or dishonored bill
37. Negotiation of bill to party already liable thereonWhere a bill is negotiated back to the drawer, or to a prior indorser or to the acceptor, such party may, subject to this Act, re-issue and further negotiate the bill, but he is not entitled to enforce payment of the bill against any intervening party to whom he was previously liable.
38. Rights of the holderThe rights and powers of the holder of a bill are as follows—
General duties of the holder
39. When presentment for acceptance is necessary
40. Time for presenting bill payable after sight
41. Rules as to presentment for acceptance, and excuses for non-presentment
42. Non-acceptanceWhen a bill is duly presented for acceptance and is not accepted within the customary time, the person presenting it must treat it as dishonoured by non-acceptance. If he does not, the holder shall lose his right of recourse against the drawer and indorsers.
43. Dishonor by non-acceptance and its consequences
44. Duties as to qualified acceptances
45. Rules as to presentment for payment
46. Excuses for delay or non-presentment for payment
47. Dishonour by non-payment
48. Notice of dishonor and effect of non-noticeSubject to this Act, when a bill has been dishonoured by nonacceptance or by non-payment, notice of dishonour must be given to the drawer and each indorser, and any drawer or indorser to whom such notice is not given is discharged:Provided that—
49. Rules as to notice of dishonourNotice of dishonour in order to be valid and effectual must be given in accordance with the following rules—
50. Excuses for non-notice and delay
51. Noting or protest of bill
52. Duties of holder as regards drawee or acceptor
Liabilities of parties
53. Funds in hands of draweeA 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.
54. Liability of acceptorThe acceptor of a bill, by accepting it—
55. Liability of drawer or indorser
56. Stranger signing bill liable as indorserWhere a person signs a bill otherwise than as drawer or acceptor, he thereby incurs the liabilities of an indorser to a holder in due course.
57. Measure of damages against parties to dishonored billWhere a bill is dishonoured, the measure of damages, which shall be deemed to be liquidated damages, shall be as follows—
58. Transferor by delivery and transferee
Discharge of bill
59. Payment in due course
60. Banker paying demand draft where an indorsement is forgedWhen a bill payable to order on demand is drawn on a banker, and the banker on whom it is drawn pays the bill in good faith and in the ordinary course of business, it is not incumbent on the banker to show that the indorsement of the payee or any subsequent indorsement was made by or under the authority of the person whose indorsement it purports to be, and the banker is deemed to have paid the bill in due course, although such indorsement has been forged or made without authority.
61. Acceptor the holder at maturityWhen the acceptor of a bill is or becomes the holder of it at or after its maturity, in his own right, the bill is discharged.
62. Express waiver
64. Alteration of the bill
Acceptance and payment for honour
65. Acceptance for honor supra protest
66. Liability of acceptor for honour
67. Presentment to acceptor for honour
68. Payment for honour supra protest
69. Holder’s right to duplicate of lost billWhere a bill has been lost before it is overdue the person who was the holder of it may apply to the drawer to give him another bill of the same tenor, giving security to the drawer if required to indemnify him against all persons whatever in case the bill alleged to have been lost shall be found again.If the drawer on request as aforesaid refuses to give such duplicate bill he may be compelled to do so.
70. Action on lost billIn any action or proceeding upon a bill, the court or a judge may order that the loss of the instrument shall not be set up, provided an indemnity be given to the satisfaction of the court or judge against the claims of any other person upon the instrument in question.
Bill in a set
71. Rules as to sets
Conflict of laws
72. Rules where laws conflictWhere a bill drawn in one country is negotiated, accepted, or payable in another, the rights, duties, and liabilities of the parties thereto are determined as follows—
Part III – Cheques on a banker
73. Cheque definedA cheque is a bill of exchange drawn on a banker payable on demand.Except as otherwise provided in this Part, the provisions of this Act applicable to a bill of exchange payable on demand apply to a cheque.
74. Presentment of cheque for paymentSubject to this Act—
75. Revocation of banker’s authorityThe duty and authority of a banker to pay a cheque drawn on him by his customer are determined by—
76. Rights of bankers collecting cheques not indorsed by holdersA banker who gives value for, or has a lien on, a cheque payable to order which the holder delivers to him for collection without indorsing it, has such (if any) rights as he would have had if, upon delivery, the holder had indorsed it in blank.
77. Unindorsed cheques as evidence of paymentAn unindorsed cheque or other instrument to which section 78 (2) applies which appears to have been paid by the banker on whom it is drawn is evidence of the receipt by the payee of the sum payable by the cheque or other instrument, as the case may be.
78. Protection of bankers paying unindorsed or irregularly indorsed cheques, etc.
79. Protection of bankers collecting payment of cheques, etc.
80. General and special crossings defined
81. Crossing by drawer or after issue
82. Crossing a material part of chequeA crossing authorized by this Act is a material part of the cheque; it shall not be lawful for any person to obliterate or, except as authorized by this Act, to add to or alter the crossing.
83. Duties of banker as to crossed cheques
84. Protection to banker and drawer where cheque is crossedWhere the banker, on whom a crossed cheque is drawn, in good faith and without negligence pays it, if crossed generally, to a banker, and if crossed specially, to the banker to whom it is crossed, or his agent for collection being a banker, the banker paying the cheque, and, if the cheque has come into the hands of the payee, the drawer, shall respectively be entitled to the same rights and be placed in the same position as if payment of the cheque had been made to the true owner thereof.
85. Effect of crossing on holderWhere a person takes a crossed cheque which bears on it the words “not negotiable,” he shall not have and shall not be capable of giving a better title to the cheque than that which the person from whom he took it had.
86. Application of certain provisions of this Act to instruments not being bills of exchangeThe provisions of this Act relating to crossed cheques shall have effect in relation to instruments, other than cheques, to which section 79 applies as they have effect in relation to cheques.
87. Government to be regarded as a customer of a bankerIf the Government has an account with a banker, the Government shall, for the purposes of this Act be regarded as a customer of that banker.
88. ConstructionThe foregoing provisions of this Act do not make negotiable any instrument which, apart from them, is not negotiable.
Part IV – Promissory notes
89. Promissory note defined
90. Delivery necessaryA promissory note is inchoate and incomplete until delivery thereof to the payee or bearer.
91. Joint and several notes
92. Note payable on demand
93. Presentment of note for payment
94. Liability of makerThe maker of a promissory note by making it—
95. Application of Part II to notes
Part V – Supplementary
96. Good faithA thing is deemed to be done in good faith, within the meaning of this Act, where it is in fact done honestly, whether it is done negligently or not.
98. Computation of timeWhere, by this Act, the time limited for doing any act or thing is less than three days, in reckoning time, non-business days are excluded.“Non-business days” for the purposes of this Act means Sundays and public holidays. Any other day is a business day.
99. When noting equivalent to protestFor the purposes of this Act, where a bill or note is required to be protested within a specified time or before some further proceeding is taken, it is sufficient that the bill has been noted for protest before the expiration of the specified time or the taking of the proceeding; and the formal protest may be extended at any time thereafter as of the date of the noting.
100. Protest when notary not accessibleWhere a dishonoured bill or note is authorized or required to be protested, and the services of a notary cannot be obtained at the place where the bill is dishonoured, any householder or substantial resident of the place may, in the presence of two witnesses, give a certificate, signed by them, attesting the dishonour of the bill, and the certificate shall in all respects operate as if it were a formal protest of the bill.The form given in Schedule I to this Act may be used with necessary modifications, and if used shall be sufficient.
101. Dividend warrants may be crossedThe provisions of this Act as to crossed cheques shall apply to a warrant for payment of dividend.
History of this document
28 July 1967
24 July 1967