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Bills of Exchange Act (R.S.C., 1985, c. B-4)

Full Document:  

Act current to 2024-06-19 and last amended on 2021-08-03. Previous Versions

PART IIBills of Exchange (continued)

Form and Interpretation of Bill (continued)

Marginal note:Bill or note

 Where in a bill drawer and drawee are the same person, or where the drawee is a fictitious person or a person not having capacity to contract, the holder may treat the instrument, at his option, either as a bill or as a note.

  • R.S., c. B-5, s. 26

Marginal note:Valid bill

 A bill is not invalid by reason only that it

  • (a) is not dated;

  • (b) does not specify the value given, or that any value has been given therefor;

  • (c) does not specify the place where it is drawn or the place where it is payable; or

  • (d) is antedated or post-dated, or bears date on a Sunday or other non-juridical day.

  • R.S., c. B-5, s. 27

Marginal note:Sum certain

  •  (1) The sum payable by a bill is a sum certain within the meaning of this Act, although it is required to be paid

    • (a) with interest;

    • (b) by stated instalments;

    • (c) by stated instalments, with a provision that on default in payment of any instalment the whole shall become due; or

    • (d) according to an indicated rate of exchange or a rate of exchange to be ascertained as directed by the bill.

  • Marginal note:Figures and words

    (2) Where the sum payable by a bill is expressed in words and also in figures and there is a discrepancy between the two, the sum denoted by the words is the amount payable.

  • Marginal note:With interest

    (3) Where a bill is expressed to be payable with interest, unless the instrument otherwise provides, interest runs from the date of the bill and, if the bill is undated, from the issue thereof.

  • R.S., c. B-5, s. 28

Marginal note:True date presumption

 Where a bill or an acceptance, or any endorsement on a bill, is dated, the date shall, unless the contrary is proved, be deemed to be the true date of the drawing, acceptance or endorsement, as the case may be.

  • R.S., c. B-5, s. 29

Marginal note:Undated bill payable after date

 Where a bill expressed to be payable at a fixed period after date is issued undated, or where the acceptance of a bill payable at sight or 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, but where the holder in good faith and by mistake inserts a wrong date, or in every other case where a wrong date is inserted, if the bill subsequently comes into the hands of a holder in due course, the bill is not voided thereby, but operates and is payable as if the date so inserted had been the true date.

  • R.S., c. B-5, s. 30

Marginal note:Perfecting bill

 Where a simple signature on a blank paper is delivered by the signer in order that it may be converted into a bill, it operates, in the absence of evidence to the contrary, as an authority to fill it up as a complete bill for any amount, using the signature for that of the drawer or acceptor, or an endorser, and, in like manner, when a bill is wanting in any material particular, the person in possession of it has, in the absence of evidence to the contrary, the authority to fill up the omission in any way he thinks fit.

  • R.S., c. B-5, s. 31

Marginal note:When completed

  •  (1) In order that any instrument referred to in section 30 when completed may be enforceable against any person who became a party thereto prior to its completion, it must be filled up within a reasonable time and strictly in accordance with the authority given, but where any such instrument, after completion, is negotiated to a holder in due course, it is valid and effectual for all purposes in his hands, and he may enforce it as if it had been filled up within a reasonable time and strictly in accordance with the authority given.

  • Marginal note:Reasonable time

    (2) Reasonable time within the meaning of this section is a question of fact.

  • R.S., c. B-5, s. 32

Marginal note:Referee in case of need

  •  (1) The drawer of a bill and any endorser may insert therein the name of a person, who shall be called the referee in case of need, to whom the holder may resort in case of need, that is to say, in case the bill is dishonoured by non-acceptance or non-payment.

  • Marginal note:Option

    (2) The holder may, at his option, resort to the referee in case of need or not, as he thinks fit.

  • R.S., c. B-5, s. 33

Marginal note:Stipulations

 The drawer of a bill, and any endorser, may insert therein an express stipulation

  • (a) negativing or limiting his own liability to the holder; or

  • (b) waiving, with respect to himself, some or all of the holder’s duties.

  • R.S., c. B-5, s. 34


Marginal note:Acceptance

  •  (1) The acceptance of a bill is the signification by the drawee of his assent to the order of the drawer.

  • Marginal note:Drawee’s name wrong

    (2) Where in a bill the drawee is wrongly designated or his name is misspelt, he may accept the bill as therein described, adding, if he thinks fit, his proper signature or he may accept by his proper signature.

  • R.S., c. B-5, s. 35

Marginal note:Acceptance

  •  (1) An acceptance is invalid unless it complies with the following conditions:

    • (a) it must be written on the bill and be signed by the drawee; and

    • (b) it must not express that the drawee will perform his promise by any other means than the payment of money.

  • Marginal note:Mere signature

    (2) The mere signature of the drawee written on the bill without additional words is a sufficient acceptance.

  • R.S., c. B-5, s. 36

Marginal note:Acceptance

  •  (1) A bill may be accepted

    • (a) before it has been signed by the drawer or while otherwise incomplete; or

    • (b) when it is overdue or after it has been dishonoured by a previous refusal to accept, or by non-payment.

  • Marginal note:Acceptance after dishonour

    (2) When a bill payable at sight or after sight is dishonoured by non-acceptance and the drawee subsequently accepts it, the holder, in the absence of any different agreement, is entitled to have the bill accepted as of the date of first presentment to the drawee for acceptance.

  • R.S., c. B-5, s. 37

Marginal note:Kinds

  •  (1) An acceptance is either general or qualified.

  • Marginal note:General

    (2) A general acceptance assents without qualification to the order of the drawer.

  • Marginal note:Qualified

    (3) A qualified acceptance in express terms varies the effect of the bill as drawn and, in particular, an acceptance is qualified that is

    • (a) conditional, that is to say, that makes payment by the acceptor dependent on the fulfilment of a condition therein stated;

    • (b) partial, that is to say, an acceptance to pay part only of the amount for which the bill is drawn;

    • (c) qualified as to time; or

    • (d) the acceptance of one or more of the drawees, but not of all.

  • Marginal note:Specified place

    (4) An acceptance to pay at a particular specified place is not on that account conditional or qualified.

  • R.S., c. B-5, s. 38


Marginal note:When acceptance complete

 Every contract on a bill, whether it is the drawer’s, the acceptor’s or an endorser’s, is incomplete and revocable until delivery of the instrument in order to give effect thereto, but where an acceptance is written on a bill and the drawee gives notice to, or according to the directions of, the person entitled to the bill that he has accepted it, the acceptance then becomes complete and irrevocable.

  • R.S., c. B-5, s. 39

Marginal note:Requisites

  •  (1) As between immediate parties and as regards a remote party, other than a holder in due course, the delivery of a bill

    • (a) in order to be effectual must be made either by or under the authority of the party drawing, accepting or endorsing, as the case may be; or

    • (b) may be shown to have been conditional or for a special purpose only, and not for the purpose of transferring the property in the bill.

  • Marginal note:Presumption

    (2) Where the bill is in the hands of a holder in due course, a valid delivery of the bill by all parties prior to him, so as to make them liable to him, is conclusively presumed.

  • R.S., c. B-5, s. 40

Marginal note:Parting with possession

 Where a bill is no longer in the possession of a party who has signed it as drawer, acceptor or endorser, a valid and unconditional delivery by him is presumed until the contrary is proved.

  • R.S., c. B-5, s. 41

Computation of Time, Non-juridical Days and Days of Grace

Marginal note:Computation of time

 Where a bill is not payable on demand, three days, called days of grace, are, in every case, where the bill itself does not otherwise provide, added to the time of payment as fixed by the bill, and the bill is due and payable on the last day of grace, but whenever the last day of grace falls on a legal holiday or non-juridical day in the province where any such bill is payable, the day next following, not being a legal holiday or non-juridical day in that province, is the last day of grace.

  • R.S., c. B-5, s. 42

Marginal note:Non-juridical days

 In all matters relating to bills of exchange, the following and no other days shall be observed as legal holidays or non-juridical days:

  • (a) in all the provinces,

    • (i) Sundays, New Year’s Day, Good Friday, Victoria Day, Canada Day, Labour Day, National Day for Truth and Reconciliation, which is observed on September 30, Remembrance Day and Christmas Day,

    • (ii) the birthday (or the day fixed by proclamation for the celebration of the birthday) of the reigning Sovereign,

    • (iii) any day appointed by proclamation to be observed as a public holiday, or as a day of general prayer or mourning or day of public rejoicing or thanksgiving, throughout Canada, and

    • (iv) the day next following New Year’s Day, Christmas Day and the birthday of the reigning Sovereign (if no other day is fixed by proclamation for the celebration of the birthday) when those days respectively fall on a Sunday;

  • (b) in any province, any day appointed by proclamation of the lieutenant governor of the province to be observed as a public holiday, or for a fast or thanksgiving within the province, and any day that is a non-juridical day by virtue of an Act of the legislature of the province; and

  • (c) in any city, town, municipality or other organized district, any day appointed to be observed as a civic holiday by resolution of the council, or other authority charged with the administration of the civic or municipal affairs of the city, town, municipality or district.

Marginal note:Time of payment

 Where a bill is payable at sight, or at a fixed period after date, after sight or after the happening of a specified event, the time of payment is determined by excluding the day from which the time is to begin to run and by including the day of payment.

  • R.S., c. B-5, s. 44

Marginal note:Sight bill

 Where a bill is payable at sight or at a fixed period after sight, the time begins to run from the date of the acceptance if the bill is accepted, and from the date of noting or protest if the bill is noted or protested for non-acceptance or for non-delivery.

  • R.S., c. B-5, s. 45

Marginal note:Due date

  •  (1) Every bill that is made payable at a month or months after date becomes due on the same numbered day of the month in which it is made payable as the day on which it is dated, unless there is no such day in the month in which it is made payable, in which case it becomes due on the last day of that month, with the addition, in all cases, of the days of grace.

  • Marginal note:Definition of “month”

    (2) The term month in a bill means the calendar month.

  • R.S., c. B-5, s. 46

Capacity and Authority of Parties

Marginal note:Capacity of parties

  •  (1) Capacity to incur liability as a party to a bill is coextensive with capacity to contract.

  • Marginal note:Corporations

    (2) Nothing in this section enables a corporation to make itself liable as drawer, acceptor or endorser of a bill, unless it may do so under the law in force relating to that corporation.

  • R.S., c. B-5, s. 47

Marginal note:Effect of disability on holder

 Where a bill is drawn or endorsed by any infant, minor or corporation having no capacity or power to incur liability on a bill, the drawing or endorsement entitles the holder to receive payment of the bill and to enforce it against any other party thereto.

  • R.S., c. B-5, s. 48

Marginal note:Forgery

  •  (1) Subject 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.

  • Marginal note:Ratification

    (2) Nothing in this section affects the ratification of an unauthorized signature not amounting to a forgery.

  • Marginal note:Recovery of amount paid on forged cheque

    (3) Where a cheque payable to order is paid by the drawee on a forged endorsement out of the funds of the drawer, or is so paid and charged to his account, the drawer has no right of action against the drawee for the recovery of the amount so paid, nor any defence to any claim made by the drawee for the amount so paid, as the case may be, unless he gives notice in writing of the forgery to the drawee within one year after he has acquired notice of the forgery.

  • Marginal note:Default of notice

    (4) In case of failure by the drawer to give notice of the forgery within the period referred to in subsection (3), the cheque shall be held to have been paid in due course with respect to every other party thereto or named therein, who has not previously instituted proceedings for the protection of his rights.

  • R.S., c. B-5, s. 49

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