1. This appeal practically depends upon the construction of one word in the letter written by the defendants on November 25, 3919. The defendants were a firm in Bombay importing goods from H. Yamamoto & Co. Ltd., a firm in Japan. H. Yamamoto & Co. drew billa on the defendants. These bills were discounted by the plaintiffs' bank in Japan and were presented in Bombay by the bank to the defendants for acceptance and payment. H. Yamamoto & Co. wished to be assured that these bills to be discounted by the bank in Japan would be honoured when presented in Bombay. The defendants accordingly, in order to secure H. Yamamoto & Co., and to finance their imports, wrote the letter of November 25, 1919, to the plaintiffs' bank. In the first part of that letter they inform the bank that they have instructed H. Yamamoto & Co. in Japan to draw certain bills upon them. In the second part of that letter they agree to accept on presentation all the bills drawn pursuant to that authority.
2. The question is what bills were H. Yamamoto & Co. authorised to draw. These bills are described in the first paragraph of that letter as 'Bills to the extent of yens 50,000 (yens fifty thousand) revolving at thirty days' sight.' What does this expression mean ?
3. For the sake of simplicity suppose each bill was for the full amount of 50,000 yens
4. Then, if the word 'revolving' did not occur when one bill of 50,000 yen was drawn, the authority given by the defendants would expire and no further bill could be drawn.
5. The effect of the word 'revolving' coupled with the last paragraph of that letter which extends the credit for a period of twelve months admittedly leads to this implication that after one bill of 50 000 yens was drawn under this authority then another bill of 50,000 yens can be drawn and so on for a period of twelve months.
6. The question then is how soon after the first bill of 50.000 yens can the second bill of 50,000 yens be drawn ?
7. It seems to me obvious that this must be only after the time limited for the first bill of 50,000 yens has expired, that is, after due date of the first bill.
8. The contention of the defendants-appellants on the other hand is that the second bill of 50,000 yens could not be drawn until after the first bill had either been paid or accepted. I do not think that this is the possible construction of that letter. In the first place on this construction the facility given to H. Yamamoto & Co. in Japan to draw bills would depend upon an uncertain event occurring in Bombay. The letter of the defendants of the same date confirming the credit shows that H. Yamamoto & Co. of Japan did not want their credit to be dependent upon any future acts of the defendants in Bombay. Further, the contention of the defendants would lead to this result that the defendants by refusing to accept or refusing to pay the first bill of 50,000 yens would render the credit of twelve months nugatory. No IN further bill could be drawn in that event because the defendants had neither accepted nor paid. It is not a reasonable construction of the document that the period of revolution should depend upon defendants' volition. The whole object of the arrangement was to facilitate the defendants' import of the goods from Japan and the construction which gives business efficacy to the document is that of the trial Judge. Mr. Kemp argues that this construction extends the limit-so it does- but a limit of 50,000 yens absolute is not the same as a limit of 50,000 yens revolving.
9. I would, therefore, confirm the decree of the lower Court and dismiss the appeal with costs.
Lallubhai Shah, Kt., Acting C.J.
10. I have felt some difficulty in coming to a conclusion in this case. Taking the three letters, which are material in this case, namely, Exhts. A, B and C, it appears that the revolving credit for 50,000 yens given by the defendants to the firm of H. Yamamoto & Co. Ltd. for twelve months was confirmed. The question is as to whether the revolving credit would be dependent upon the payment by the defendants of the bills drawn on them after acceptance. The contention of the defendants is that until the payment is made by them the credit does not commence to revolve and so long as the sum is unpaid the sum unpaid must be taken into account in determining whether at any given time the extent of the credit mentioned in the letter is exhausted or not. It has been pointed out in the judgment just delivered by my learned brother that that would involve this result that the extent of the credit would be dependent upon the fulfilment by the defendants on their part of the undertaking, namely, the payment of the bills in Bombay. It was a necessary part of the arrangement evidenced by these letters, that the firm in Japan was to be assured that the bills up to a certain limit within twelve months would be discounted by the plaintiffs' bank in Japan, That purpose would not be served if the construction contended for by the defendants is accepted. Having regard to the wording of the letter, dated November 25,1919, it is fair to hold that the expression 'with recourse to the extent of 50,000 yens revolving' means that the bills not exceeding 50,000 yens could be discounted in Japan without any reference to actual payment of the bills in Bombay by the defendants so long as the limit was not exceeded during the time when the bills would become due. Instead of taking the actual payment of the bills to mark the limit of time for the revolving of the (credit, it would be more reasonable, and in accordance with the business understanding of such an arrangement, to hold that the revolving would commence after the due date of the particular bill subject to the condition that within any given period the limit of 50,000 yens is not exceeded.
11. I, therefore, concur in the order proposed by my learned brother.