Section 86 - Parties not consenting discharged by qualified or limited acceptance, Section 87 - Effect of material alteration : Negotiable Instruments Act 1881

Who are Parties not consenting discharged by qualified or limited acceptance? What is the Effect of material alteration? Parties not consenting discharged by qualified or limited acceptance and Effect of material alteration are defined under Section 86 and 87 of Negotiable Instruments Act 1881

Section 86 of Negotiable Instruments Act 1881: "Parties not consenting discharged by qualified or limited acceptance"

If the holder of a bill of exchange acquiesces in a qualified acceptance, or one limited to part of the sum mentioned in the bill, or which substitutes a different place or time for payment, or which, where the drawees are not partners, is not signed by all the drawees, all previous parties whose consent is not obtained to such acceptance are discharged as against the holder and those claiming under him, unless on notice given by the holder they assent to such acceptance.

Explanation : An acceptance is qualified-
(a) where it is conditional, declaring the payment to be dependent on the happening of an event therein stated;

(b) where it undertakes the payment of part only of the sum order to be paid;

(c) where, no place of payment being specified on the order, it undertakes the payment at a specified place, and not otherwise or elsewhere; or where, a place of payment being specified in the order, it undertakes the payment at some other place and not otherwise or elsewhere;

(d) where it undertakes the payment at a time other than that at which under the order it would be legally due.

Section 87 of Negotiable Instruments Act 1881: "Effect of material alteration"

Any material alteration of a negotiable instrument renders the same void as against anyone who is a party thereto at the time of making such alteration and does not consent thereto, unless it was made in order to carry out the common intention of the original parties;

Alteration by indorsee.-And any such alteration, if made by an indorsee, discharges his indorser from all liability to him in respect of the consideration thereof.

The provisions of this section are subject to those of sections 20, 49, 86 and 125.