Page:Harvard Law Review Volume 32.djvu/797

761 ACCELERATION PROVISIONS IN TIME PAPER 761 holders as have notice of the dishonor. As to them the bill is over- due; ^° drawer and indorsers are discharged by want of notice; ^^ and the Statute of Limitations runs from the dishonor.^^ As to holders in due course, ignorant of the dishonor, the instrument re- mains due for all purposes at the original maturity, and the accel- eration is immaterial.^^ The implied acceleration provision of the bill of exchange operates according to the principles stated on page 756 of this article. (I) Acceleration is by an act incidental to the collection of the instrument, presentment for acceptance; (II) it applies to persons with notice; (III) it does not apply to persons without notice. The same principles should govern express acceleration provisions generally. A purchaser ignorant of the fact of acceleration is, in the words of the Negotiable Instruments Law,^ a holder in due course of the instrument, because "he became the holder of it be- fore it was overdue, and without notice that it had been previously dishonored, if such was the fact." Therefore, he can rely on the face of the instrument, treat it as maturing at the stated day, and recover its full amount at that time.^^ Consequently, on instruments payable "on or before" a fixed date at the holder's option, the fixed term is maturity for all purposes except for persons with notice of demand and refusal.*^ Such in- struments are well fitted for circulation, for they offer a durable investment, with the possibihty of earlier collection when the holder needs the money or apprehends the insolvency of the obUgor.^^ M. & W. 733 (1845); Robinson v. Ames, 20 Johns. (N. Y.) 146, 150 (1822), semble. <2 Whitehead v. Walker, 9 M. & W. 506 (1842). « Dunn V. O'Keefe, 5 M. & S. 282 (1816); N. I. L. § 117. « N. I. L. § 57. payee bank to appropriate makers' deposit in payment at any time. Tyson, J.: "The purchaser would have the right to presume, unless the sum appropriated by the bank [payee] . . . was indorsed somewhere upon the note, that none had been made by the bank; and that the full amount was owing by the makers." Bill, 31 Conn. 534 (1863). Such a note is subject to special difficulties, for it is not surrendered upon payment, and may be negotiated to a purchaser ignorant of the prior part payment, who would, it seems, recover from the maker in full. For analogous instruments, see note 108, infra. The note in Protection Insurance Co. v. Bill had an additional peculiarity, in that advance payments could be required "within thirty
 * " Goodman v. Harvey, 4 Ad. & El. 870 (1836); N. I. L. § 52 (2).
 * ^ Whitehead v. Walker, 9 M. & W. 506, 513, 514 (1842); Bartlett v. Benson, 14
 * § 52 (2).
 * ^ Louisville v. Gray, 123 Ala. 251, 256, 26 So. 207 (1898), — note authorizing the
 * '' The holder can call for part payments in advance. Protection Insurance Co. v.