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Special Rules Of Evidence

Q. What are rules of evidence relating to a negotiable instrument. (1997)(1998)(2001)


(2002)(2006/A)

1. Introduction:

The negotiable instruments act lays down certain special rules of evidence but the applicability
of general principles of law and ordinary rules of evidence cannot be excluded in claims relating
to negotiable instrument.

2. Relevant previsions:

Sec 118 negotiable instrument act.

3. Meaning of presumption:

Black's law dictionary:

A legal inference or assumption that a fact exists, based on the known or proven existence of
some other fact or group of facts.

4. Definition presumption:

Williami P. Richardson:

A presumption may be defined to be an inference as to the existence of one fact from the
existence of some other fact founded upon a provisions experience of their connection.

5. Presumption as to negotiable instrument:

Under sec 118 of negotiable instruments act, following are the presumptions, shall be attached
to the negotiable instrument unless it is proved to the contrary.

I. As to consideration:

Every negotiable instrument is deemed to have been made or draw for reasonable consideration
and it was negotiated .

II. As to date:

That every negotiable instrument bearing the date is deemed to have been made or drawn on
that such date.

III. As to time of acceptance:

That every acceptance bill of exchange was accepted within a reasonable time after its date and
before its maturity.

IV. As to order of endorsement:

That the endorsements appearing upon a negotiable instrument were made in the order in
which they appear thereon.

V. As to time of transfer:

That every transfer of a negotiable instrument was made before its maturity.

VI. As to stamp:

That a lost promissory note, bill of exchange or cheque was duly stamped.

VII. That holder is a holder in the course:

The holder of a negotiable instrument is a holder in due course.

Condition:

Where the instrument has been obtained from its lawful owner or form any person in lawful
custody thereof, by means of an offence or fraud, or has been obtained from the maker or
acceptor thereof by means of an offence or fraud or for unlawful consideration, the burden of
proving that the holder is a holder in due course lies upon him.

VIII. Presumption as to foreign law:

The law of any foreign country regarding P/N, B/E and cheques shall be presumed to be same as
that of Pakistan. unless and until country is proved.

6. Nature of presumptions:

Presumptions are not conclusive and always Rebuttable and can be rebutted even by
circumstantial evidence.

7. Conclusion:

To conclusion I can say that, under negotiable instrument act certain presumptions apply to
negotiable instruments unless contrary is proved. these presumptions are regarding
consideration, date, time acceptance, stamp and holder in due course.