Facts of the case
- Person B accepted a Bill of Exchange originally drawn in Paris.
- The Endorsee, in collusion with the Drawer, altered the bill by changing the place of drawing from Paris to Rome.
Issues in the case
- Whether Person B remains liable on the Bill of Exchange after the alteration of the place of drawing.
- Whether the alteration made by the Endorsee and Drawer without the knowledge or consent of the acceptor affects the acceptor’s liability.
Principles associated with the case
- Under the Negotiable Instruments Act, any material alteration in a bill of exchange without the consent of all parties liable on it discharges the parties from liability.
- An alteration that changes the legal effect of the instrument generally invalidates the liability of parties not consenting to it.
- The acceptor is not liable on the bill if the alteration is fraudulent and done without their consent.
Judgement
- Person B is not liable on the Bill of Exchange after the alteration of the place of drawing.
- The unauthorized alteration by the Endorsee and Drawer has discharged Person B from liability as the alteration is material and done without the acceptor’s consent.