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Contracts. A penalty affixed by law to the non-payment of a bill of exchange when it is not paid at maturity, which the parties to it are obliged to pay to the holder.

The discordant and shifting regulaaions on this subject which have been enacted in the several states, render it almost impossible to give a correct view of this subject. The drawer of a bill of exchange may limit the amount of damages by making a memorandum in the bill, that they shall be a definite sum; as, for example, "In case of non-acceptance or non-payment, reexchange and expenses not to exceed ___________ dollars. 1 Bouv. Inst. n. 1133. The following abstract of the laws of several of the United States, will be acceptable to the commercial lawyer.

- Alabama. 1. When drawn on a person in the United States. By the Act of January 15, 1828, the damages on a protested bill of exchange drawn on a person, either in this or any other of the United States, are ten per cent. By the Act of December 21, 1832, the damages on such bills drawn on any person in this state, or upon any person payable in New Orleans, and purchased by the Bank of Alabama or its branches, are five per cent.

Damages on protested bills drawn on on person out of the United States are twenty per cent.

- Arkansus. 1. It is provided by the Act of February 28, 1838, s. 7, Ark. Rev. Stat. 150, that "every bill of exchange expressed to be for value received, drawn or negotiated within this state, payable after date, to order or bearer, which shall be duly presented for acceptance or payment, and protested for non-acceptance or non-payment, shall be subject to damages in the following cases: first, if the bill have been drawn on any person at any place within this state, at the rate of two per centum on the principal sum specified in the bill; second, if the bill shall be drawn on any person, and payable in any of the states of Alabama, Louisiana, Mississippi, Tennessee, Kentucky, Ohio, Indiana, Illinois, and Missouri, or any point on the Ohio river, at the rate of four per centum on the principal sum in such bill specified: third, if the bill shall have been drawn on auy person, and payable at any place within the Iimits of the United States, not hereinbefore expressed, at the rate of five per centum on the principal sum specified in the bill: fourth, if the bill shall have been drawn on any person, and payable at any point or place beyond the limits of the United States, at the rate of ten per centum on the sum specified in the bill.

And by the 8th section of the same act, if any bill of exchange expressed to be for value received, and made payable to order or bearer, shall be drawn on any person at any place within this state, and accepted and protested for non-payment, there shall be allowed and paid to the holder, by the acceptor, damages in the following cases: first, if the bill be drawn by any person at any place within this sate, at the rate of two per centum on the principal sum therein specified: second, if the bill be drawn at any place without this state, but within the limits of the United States, at teh rate of six per centum on the sum therein specified: third, if the bill be drawn on any person at any place without the limites of the United Sates, at the rate of ten per centum on the sum therein specified. And, by sect 9, in addition to the damages allowed inthe two preceding sections to the holder of any bill of exchange protested for non-payment or nonacceptance, he shall be entitled to costs of protest, and interest at the rate of ten per centum per annum, on the amount specified in the bill, from the date of teh protest until the amount of the bill shall be paid."

- Connecticut. 1. When drawn on another place in the United States. When drawn upon persons in the city of New York, two per cent. When in other parts of the state of New York, or the New England states (other than this,) New Jersey, Pennsylvania, Delaware, maryland, Virginia, or the District of Columbia, three per cent. When on persons in North or South Carolina, Georgia, or Ohio, five per cent. On other states, territories or districts, in the United States, eight per cent, on the principal sum in each case, with interest on the amount of such sum, with the damage after notice and demand. Stat. tit. 71, Notes and Bills, 413, 414. When drawn on persons residing in Connecticut no damages are allowed.

When the bill is drawn on person out of the United States, twenty per cent is said to be the amount which ought reasonably to be allowed. Swift's Ev. 336. There is no statutory provision on the subject.

- Delaware. If any person shall draw or endorse any bill of exchange upon any person in Europe, or beyond seas, and the same shall be returned back unpaid, with a legal protest, the drawer there and all others concerned shall pay and discharge the contents of the said bill, together with twenty per cent advance f or the damage thereof; and so proportionably for a greater or less sum, in the sam specie as the same bill was drawn, or current money of this government equivalent to that which was first paid to the drawer or endorser.

- Georgia. 1. Bills on persons in the United States. First, in the state. No damages are allonved on protested bills of exchange drawn in the state, on a person in the state, except bank bills, on which the damages are ten per cent for refusal to pay in specie. 4 Laws of Geo. 75. Secondly, upon bills drawn or negotiated in the state on persons out of the state, but within the United States, five per cent, and interest. Act of 1823, Prince's Dig. 454; 4 Laws of Geo. 212.

When drawn upon a person out of the United States, ten per cent. damages and postage, protest and necessary expenses; also the premium, if any, on the face of the bill; but if at a discount, the discount must be deducted. Act of 1827, Prince's Dig. 462; 4 Laws of Geo. 221.

- Indiana. 1. When drawn by a person in the state on another person in Indiana, no damages are allowed.

When drawn on a person in another state, territory, or district, five per cent. 3. When drawn on a person out of the United States, ten percent. Rev. Code, c. 13, Feb. 17, 1838.

- Kentucky. 1. When drawn by a person in Kentucky on a person in the state, or in any other state, territory, or district of the United Stateg, no damages are allowed. See, Acts, Sessions of 1820, p. 823.

When on a person in a foreign country, damages are given at the rate of ten per cent. per ann. from the date of the bill until paid, but not more than eighteen months interest to be collected. 2 Litt. 101.

- Louisiana. The rate of damages to be allowed and paid upon the usual protest for non-acceptance, or for non-payment of bills of exchange, drawn or negotiated within this state in the following cases, is as follows: on all bills of exchange drawn on or payable in foreign countries, ten dollars upon the hundred upon the principal sum specified in such bills; on all bills of exchange, drawn on and payable in other states in the United States, five dollars upon the hundred upon the principal sum specified in such bill. Act of March 7, 1838, s. 1.

By the second section of the same act it is provided that such damages shall be in lieu of interest, charge of protest, and all other charges, incurred previous to the time of giving notice of non-acceptance or non-payment; but the principal and damages shall bear interest thereafter.

By section 3, it is enacted, that if the contents of such bill be expressed in the money of account of the United States, the amount of the principal and of the damages herein allowed for the non-acceptance or non-payment shall be ascertained and determined, without any reference to the rate of exchange existing between this state and the place on which such bill shall have been drawn, at the time of the payment, on notice of non-acceptance or non- payment.

- Maine. 1. When drawn payable in the United States. The damages in addition to the interest are as follows: if for one hundred dollars or more, and drawn, accepted, or endorsed in the state, at a place, seventy-five miles distant from the place where drawn, one per cent.; if, for any sum drawn, accepted, and endorsed in this state, and payable in New Hampshire, Vermont, Connecticut, Rhode Island, or New York, three per cent; if payable in New Jersey, Pennsylvania, Delaware, Maryland, Virginia, South Carolina, Georgia, or the District of Columbia, six per cent.; if payable in any other state, nine per cent. Rev. St. tit. 10 c. 115, §§110, 111.

Out of the United States, no statutory provision. It is the usage to allow the holder of the bill the money for which it was drawn, reduced to the currency of the state, at par, and also the charges of protest with American interest upon those sums from the time when the bill should have been paid and the further sum of one-tenth of the money for which the bill was drawn, with interest upon it from the time payment of the dishonored bill was demanded of the drawer. But nothing has been allowed for re-exchange, whether it is below or above par. Per Parsons, Ch. J. 6 Mass. 157, 161 see 6 Mass. 162.

Maryland. 1. No damages are allowed when the bill is drawn in the state on another person in Maryland.

When it is drawn on any "person, company, or society, or corporation in any other of the United States," eight per cent. damages on the amount of the bill are allowed, and an amount to purchase another bill, at the current exchange, and interest and losses of protest.

If the bill be drawn on a "foreign country," fifteen per cent. damages are allowed, and the expense of purchasing a new bill as above, besides interest and costs of protest. See Act of 1785, c. 88.

- Michigan. 1. When a bill is drawn in the state on a person in the state, no damages are allowed.

When drawn or endorsed within the state and payable out of it, within the United States, the rule is as follows: in addition to the contents of the bill, with interest and costs, if payable within the states of Wisconsin, Illinois, Indiana, Ohio, and New York, three per cent. on the contents of the bill if payable within the states of Missouri, Kentucky, Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, Connecticut, New Jersey, Pennsylvania, Delaware, Maryland, Virginia, or the District of Columbia, five per centum; if payable elsewhere in the United States, out of Michigan, ten per cent. Rev. St. 156, S. 10.

When the bill is drawn within this state, and payable out of the United States, the party liable must pay the same at the current rate of exchange at the time of demand of payment, and damages at the rate of five per cent. on the contents thereof, together with interest on the said contents, which must be computed, from the date of the protest, and are in full of all damages and charges and expenses. Rev. Stat. 156, s. 9.

- Mississippi. 1. When drawn on a person in the state, five per cent. damages are allowed. How. & Hutch. 376, ch. 35, s. 20, L. 1827; How. Rep. 3. 195.

When drawn on a person in another state or territory, no damages are given. Id. 3. When drawn on a person out of the United States, ten per cent. damages are given, and all charges incideutal thereto, with lawful interest. How. & Hutch. 376, ch. 35, s. 19, L. 1837.

- Missouri. 1. When drawn on a person within the state, four per cent. damages on the sum specified in the bill are given. Rev. Code, 1835, §8, cl. 1, p. 120.

When on another state or territory, ten per cent. Rev. Code, 1835, §8, cl. 2, p. 120. 3. When on a person out of the Unted States, twenty per cent. Rev. Code, 1835, §8, cl. 3, p. 120.

- New York. By the Revised Statutes, Laws of N. Y. sess. 42, ch. 34, it is provided that upon bills drawn or negotiated within the state upon any person, at any place within the six states east of New York, or in New Jersey, Pennsylvania, Ohio, Delaware, Maryland, Virginia, or the District of Columbia, the damages to be allowed and paid upon the usual protest for non-acceptance or non-payment, to the holder of the bill, as purchase thereof, or of some interest therin, for a valuable consideration, shall be three per cent. upon the principal sum specified in the bill; and upon any person at any place within the states of North Carolina, South Carolina, Georgia, Kentucky, and Tennessee, five percent; and upon any person in any other state or territory of the United States, or at any other place on, or adjacent to, this continent, and north of the equator, or in any British or foreign possessions in the West Indies, or elsewhere in the Western Atlantic Ocean, or in Europe, ten per cent. The damages are to be in lieu of interest, charges of protest, and all other charges incurred previous to, and at the time of, giving notice of non-acceptance or non-payment. But the holder will be entitled to demand and recover interest upon the aggregate amount of the principal sum specified in the bill, and the damages from time of notice of the protest for non-acceptance, or notice of a demand and protest for non-payment. If the contents of the bill be expressed in the money of account of the United States, the amount due thereon, and the damages allowed for the non-payment, are to be ascertained and determined, without reference to the rate of exchange existing between New York and the place on which the bill is drawn. But if the contents of the bills be expressed in the money of account or currency of any foreign. country, then the amount due, exclusive of the damages, is to be ascertained and determined by the rate of exchange, or the value of such foreign currency, at the time of the demand of payment.

- Pennsylvania. The Act of March 30, 1821, entitled an act concerning bills of exchange, enacts, that, §1, "whenever any bill of exchange hereafter be drawn and endorsed within this commonwealth, upon any person or persons, or body corporate, of, or in any other state, territory, or place, shall be returned unpaid with a legal protest, the person or persons to whom the same shall or may be payable, shall be entitled to recover and receive of and from the drawer or drawers, or the endorser or endorsers of such bill of exchange, the damages hereinafter specified, over and above the principal sum for which such bill of exchange shall have been drawn, and the charges of protest, together with lawful interest on the amount of such principal sum, damages and charges of protest, from the time at which notice of said protest shall have been given, and the payment of said principal sum and damages, and charges of protest demanded; that is to say, if such bill shall have been drawn upon any person or persons, or body corporate, of, or in any of the United States or territories thereof, excepting the state of Louisiana, five per cent. upon such principal sum; if upon any person or persons, or body corporate, of, or in Louisiana, or of, or in any other state or place in North America, or the islands thereof, excepting the northwest coast of America and Mexico, or of, or in any of the West India or Bahama Islands, ten per cent. upon such principal sum; if upon any person or persons, or body corporate, of, or in the island of Madeira, the Canaries, the Azores, the Cape de Verde Islands, the Spanish Main, or Mexico, fifteen per cent. upon such principal sum; if upon any person or persons, or body corporate, of, or in any state or place in Europe, or any of the island's thereof, twenty per cent. upon such principal sum; if upon any person or persons, or body corporate, of, or in any other part of the world, twenty-five per cent. upon such principal sum.

- §2. "The damages, which, by this act, are to be recovered upon any bill of exchange, shall be in lieu of interest and all other charges, except the charges of protest, to the time when notice of the protest and demand of psyment shall have been given and made, aforesaid; and the amount of such bill and of the damages payable thereon, as specified in this act, shall be ascertained and determined by the rate, of exchange, or value of the money or currency mentioned in such bill, at the time of notice of protest and demand of payment as before mentioned."

- Tennessee. 1. On a bill drawn or endorsed within the state upon any person or persons, or body corporate, of, or in, any other state, territory, or place, which shall be returned unpaid, with a legal protest, the holder shall be entitled to the damages hereinafter specified, over and above the principal sum for which such bill of exchange shall have been drawn, and the charge of protest, together with lawful interest on the amount of such principal sum, damages, and charges of protest, from the time at which notice of such protest shall have been given, and the payment of said principal sum, damages, and charges of protest demanded; that is to say, if such bill shall have been drawn on any person or persons, or body corporate, of, or in any of these United States, or the territories thereof, three per cent. upon such principal sum: if upon any other person or persons, or body corporate, of, or in, any other state or place in North America, bordering upon the Gulf of Mexico, or of, or in, any of the West India Islands, fifteen per cent. upon such principal sum; if upon any person or persons, or body corporate, of, or in, any other part of the world, twenty per ceut. upon such principal sum.

The damages which, by this act, are to be recovered upon any bill of exchange, shall be in lieu of interest and all other charges, except charges of protest, to the time when notice of the protest and demand of payment shall have been given and made as aforresaid. Carr. & Nich. Comp. 125; Act of 1827, c. 14.