Bills of Exchange; Interest; Usury.
Sec.1. A bill of exchange is a written order or request to a person in a distant place, to pay a third person a certain sum of money. The following is a common form:
$1,000. New-York, August 10, 1859.
Twenty days after date,
(or at sight, or ten days after sight,) pay
to the order of John Stiles, one thousand dollars, value received,
and charge the same to account of
To George Scott, Thomas Jones.
New Orleans, La.
Sec.2. Bills drawn on persons in foreign countries, are called foreign bills of exchange; those drawn on persons in distant places in our own country, are called inland bills of exchange. To persons in mercantile business they are of great convenience, as will be seen from the following example of their nature and operation.
Sec.3. A, in New-York, has $1,000 due him from B, in New Orleans. A draws an order on B for that sum, and C, who is going to New Orleans, pays A the money, takes the order, and receives his money again of B. Thus A is accommodated by receiving his debt against B, and O has avoided the risk of carrying the money from place to place. A, who draws the order, or bill, is called the drawer. B, to whom it is addressed, is the drawee; C, to whom it is made payable, is the payee. As the bill is payable to C, or his order, he may, by indorsment, direct the bill to be paid to D; in which case C becomes the indorser, and D, to whom the bill is indorsed, is called the indorsee or holder.
Sec.4. If, when a bill is presented to the drawee, he agrees to pay it, he is said to accept the bill, and writes his acceptance upon it. An acceptance may, however, be by parol. The acceptor of a bill is the principal debtor; the drawer, the surety. The acceptor is bound, though he accepted without consideration, and for the sole accommodation of the drawer. But payment must be demanded on the last day of grace; and, if refused, notice of non-payment must be given to the drawer, as in the case of an indorsed promissory note. (Chap. LX, Sec.15.)