Business men generally draw the drafts on their customers in favour of themselves, thus, " ° pay to ourselves or order," or in favour of their bank as in the foregoing example (c). When the draft is to be placed with the bank for collection or discount, the second method is preferable.
Acceptance of Drafts.
In the foregoing draft, M. Sinclair is not liable for the amount- until he accepts it, that is, writes his name, with or without the word accepted, across the face of the draft, preferably in red ink. (See the example in Section 27.) By this act he accepts the terms of the draft—he agrees to pay the amount. The draft now becomes an accepted draft or acceptance ; the term acceptance may mean either the writing across the face of the draft, or the whole draft after it is accepted. In the example above, it is Pupil's draft, but it is M. Sinclair's acceptance.
Examples of Acceptance.
Form I. is sufficient to make M. Sinclair liable, but Form II. is the one recommended by accountants. " Thirty days after sight" means "thirty days after acceptance," so that the date must be added to the acceptance in this case, to fix the due date ; " thirty days after date" means thirty days after the date of the draft at the top, and therefore the date of acceptance is not necessary to fix the due date. It is considered better, however, to add both date and place of payment to all acceptances. Form III. changes the amount, and Form IV. changes the time.
Accepted. III. Accepted, April 3, 19-,
11 Sinclair. For Two Hundred Dollars. if. Sinclair.
Accepted, April 3, 19-, IV. Accepted, April 3, 19-,
Payable at the Dominion Bank. Payable sixty days after date.
M. Sinclair. M. Sinclair.