Home  /  Negotiable Instruments Act  /  Section 95

Section 95: Party receiving must transmit notice of dishonor

Negotiable Instruments Act • Official Statutory Text & Practice Guide

Statutory Regulation
Legal Standard
Competent Court / Tribunal
Act 1881
Section 94 All 148 Sections of Negotiable Instruments Act Section 96

Legal Commentary & Landmark Judgments: Section 95

Section 95 regulates the transmission of notice of dishonour by a party who receives it, enacting that an indorser receiving notice must transmit it within a reasonable time to prior parties whom they intend to hold liable.

  • Cascading Transmission: Each indorser receiving notice has a fresh period of reasonable time to notify the party immediately preceding them in the chain of indorsements.
  • Preservation of Indemnity: Failure by an intermediate indorser to notify their prior party discharges that prior party as against them.
  • Inurement of Notice: Notice given by any party inures to the benefit of all prior and subsequent holders.
Key Landmark Precedents:
  • Horne v. Rouquette (1878) 3 QBD 514: The leading authority establishing that each successive indorser has a distinct statutory window to pass notice backward along the chain of title.
  • Ram Singh v. Gulab Rai: Affirmed that an indorser who satisfies the holder's demand must prove timely transmission of notice under Section 95 to recover from their own indorser.
Courtroom Practice & Strategic Litigation Guidance:

If representing an indorser who receives a notice of dishonour from a bank, do not delay. Within 24-48 hours, issue a formal transmission notice under Section 95 to your client's prior indorser and the drawer to preserve full indemnity rights.

Section 94 All 148 Sections of Negotiable Instruments Act Section 96