The actio cambiaria and the pleas on the bill of exchange

Abstract

CREDIT is today the keyword to the commercial world. This has led to the creation of the credit instrument aiming at a more economical and efficient exchange of wealth in our society. As a consequence, a considerable number of commercial transactions are today affected by the drafting of the so-called BILL OF EXCHANGE. The possession of a bill of exchange offers considerable advantages to the creditor, in the sense that the instrument is, in itself, tangible proof of the existence of the debt inherent in the bill. Al so, in the case where the bill has been dishonoured and the creditor does not recover the amount owed to him in terms of the bill, the law lays down a special judicial procedure wherein the creditor may still convert the bill into paper money in a quick and efficient manner. An added advantage inherent in this credit instrument is that a bill of exchange favours negotiability. A person offering credit may be able to obtain the money his debtor is not able to give him, in a short span of time, by transferring the bill through endorsement. The drafting of the bill of exchange has, in fact, become widely diffused in Malta especially with regard to hire-purchase agreements of durable goods. Yet it is doubtful whether the ordinary layman understands the workings of this instrument of credit in his day-to-day transactions? Although the bill of exchange has practically been the paper currency of traders well before the mints of the states shifted their preference from coins to printed notes, yet, it must be admitted that the public in general is hardly, if at all acquainted with this credit instrument and its implications. The law offers little illumination on the matter having in the first place omitted to define in a clear and concise manner the bill of exchange itself. It must also be pointed out at the very outset, that the law has hardly been amended since its promulgation in the late half of the ninteenth century. Perhaps one could argue that the original legislators were under the impression that the law they had drafted regulated in a comprehensive manner the workings of this instrument of credit to such an extent that no subsequent reforms were necessary!