Limitation and personal liability on cheques: invoice claims were time-barred, but timely cheque claims survived and bound the signatory.

Limitation for a price-of-goods claim runs from the date of delivery where no fixed credit period is proved, so invoice claims raised after three years were time-barred. Cheques issued towards the debt gave rise to a fresh cause of action, and only cheque-based claims falling within three years of the suit survived limitation. An authorised signatory who signed cheques without disclosing that he acted only in a representative capacity incurred personal liability on the instruments. The suit was therefore maintainable only to the extent of the cheque amounts found within time, with interest granted as directed by the Court.

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Issues: (i) Whether the claim for price of goods supplied under invoices and the claim based on dishonoured or unpresented cheques was barred by limitation; (ii) whether the authorised signatory who signed the cheques without disclosing that he acted only as an agent incurred personal liability on the instruments.

Issue (i): Whether the claim for price of goods supplied under invoices and the claim based on dishonoured or unpresented cheques was barred by limitation.

Analysis: For the invoices relating to supply of goods, in the absence of proof of a fixed period of credit, the governing rule was the limitation for price of goods sold and delivered running from the date of delivery. The invoices relied upon were all beyond three years before institution of the suit, so that part of the claim was time-barred. For the cheque-based claim, the issuance of cheques furnished a fresh cause of action, and limitation for such claim was taken from the date of the cheque. Only those cheques falling within three years before the suit survived the limitation objection.

Conclusion: The claim on the supply invoices was barred by limitation, while only the cheque amounts falling within the limitation period were recoverable.

Issue (ii): Whether the authorised signatory who signed the cheques without disclosing that he acted only as an agent incurred personal liability on the instruments.

Analysis: A person signing a cheque as an agent, without indicating that he signs only in a representative capacity or without negativing personal responsibility, is personally liable on the instrument. The drawer of a cheque is liable to compensate the holder, and the statutory scheme governing negotiable instruments fastens liability on the signatory where agency is not disclosed. On the facts, the cheques were signed by the authorised signatory without any disclaimer of personal liability.

Conclusion: The authorised signatory was personally liable for the amount found due on the cheques.

Final Conclusion: The suit succeeded only to the extent of the cheque amounts found within time, with pre-institution, pendente lite and future interest granted at the rates indicated by the Court, while the remaining principal claim was rejected as time-barred.

Ratio Decidendi: In a claim for sale proceeds, limitation runs from delivery unless a fixed credit period is proved, and a cheque issued towards the debt gives a fresh cause of action from the date of the cheque; an authorised signatory who signs without disclosing limited agency assumes personal liability on the instrument.

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