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Section 107: Reasonable time for transmitting such notice

Negotiable Instruments Act • Official Statutory Text & Practice Guide

Statutory Regulation
Legal Standard
Competent Court / Tribunal
Act 1881
Section 106 All 148 Sections of Negotiable Instruments Act Section 108

Legal Commentary & Landmark Judgments: Section 107

Section 107 regulates reasonable time for transmitting notice of dishonour by an intermediate party, enacting that an indorser receiving notice has the same time to transmit it to prior parties as if they were the original holder.

  • Fresh Time Period for Each Indorser: Each intermediate party receiving notice has until the next business day to transmit notice to their prior indorser.
  • Sequential Transmission Standard: Allows cascading communication down the chain of commercial indorsements.
  • Discharge for Delay in Transmission: If any intermediate indorser sleeps on their rights and fails to transmit within Section 107 time, prior parties are released.
Key Landmark Precedents:
  • Horne v. Rouquette (1878) 3 QBD 514: Affirmed that each indorser in a chain of commercial bills enjoys an independent Section 107 time window to notify their predecessor.
  • Gladwell v. Turner (1870): Discussed the cumulative calculation of transmission timelines under commercial paper principles.
Courtroom Practice & Strategic Litigation Guidance:

When suing multiple indorsers, compile a date-stamped timeline showing when each indorser received and forwarded notice. Demonstrating continuous compliance with Section 107 prevents defendants from raising delay defenses.

Section 106 All 148 Sections of Negotiable Instruments Act Section 108