— Part
Business of Banking.
III.
the express understanding that it may be drawn against at once, and it is so drawn against (s). So probably if the cheque is received on that footing, whether it is in fact drawn against or not {a), or is paid in in express reduction of an overdraft (5). But the mere existence of an overdraft, though the banker's lien in respect thereof constitutes him for certain purposes a holder for value to the extent of that lien (c), would not appear to preclude the protection (d).
1221. The mere fact that the banker has credited the cheque cash before receiving the proceeds does not prevent his subsequently receiving them for the customer, or deprive him of
597 Sect.
3.
Collection of Cheques,
Crediting as
as
protection
But
(f).
would appear that the other incidents
of crediting as cash apply in the case of crossed cheques (/). If so credited the customer can therefore draw against the cheque at once (g), unless by special agreement or course of business he is precluded from so doing {It) The banker can, in the absence of a forged indorsement, sue upon a crossed cheque in his own name as a holder in due course, unless the cheque is crossed " not negotiable " (i), and may debit the customer if the cheque is dishonoured (j) He may apparently set up the position of holder for value as against the person claiming as true owner, except where the indorsement is forged or the cheque is marked "not it
still
.
.
negotiable."
1222. Where a cheque is crossed "not negotiable" the banker "Notnegocannot avail himself of the defence that he dealt with the cheque liable" crossmg. pendmg revocation of a voidable title in the customer (k). (s)
National Bank
(a)
Roijal
(6) (c) (rf)
v. Silke, [1891] 1 Q. B. 435, per Bowen, L.J., at p. 439. Bank of Scotland v. Tottenham, [1894] 2 Q. B. 715. Compare London and Comity Bank v. Groome (1881), 8 Q. B. D. 288. Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), s. 27 (3). Clarke v. London aiid County Bank, [1897] 1 Q. B. 552. The banker might
be said to have waived his lien on the cheque, presented it on behalf of the customer, and retained the proceeds by virtue of his right of set-off. Compare Great Western Rail. Co. v. London and County Banking Co., [1900] 2 Q. B. 46i, per RoMER, L.J., at p. 476 the same case, [1901] A. C. 414, per Lord Lindley, at Where Lord Macnaghten, as i)reviously quoted (note (r), p. 596, ante), p. 424. spoke of " holder for value," it is suggested that he meant " transleree for value." (e) Bills of Exchange (Crossed Cheques) Act, 1906 (6 Bdw. 7, c. 17). Doubts have been expressed whether this was not the case even apart from the Act by BiGHAM, J., in Akrokerri (Atlantic) Mines, Ltd. v. Economic Bank, [1904] 2 K. B. 465, and Channell, J., in Bevan v. The National Bank (1906), 23 T. L. B. 65. But see Capital and Counties Bank v. Gordon, [1903] A. C. 240, in consequence of which the Act was passed. The Act is not retrospective, and does not affect transactions prior to its coming into operation. See Bevan v. The National Bank, supra. (/) The Bills of Exchange (Crossed Cheques) Act, 1906 (6 Edw. 7, c. 17), is by its terms confined to the protection of the banker against the true owner. (g) Capital and Counties Bank v. Gordon, supra, per Lord Lindley, at p. 249. (/i) Compare Akrokerri (Atlantic) Mines, Ltd. v. Economic Bank, supra. (i) Royal Bank of Scotland v. Tottenham, supra. (j) Capital and Counties Bank v. Gordon, supra, per Lord Lindley, at p, 248. (k) As to this defence in the case of other cheques, see Tate v. Wilts and Dorset Bank (1899), Journal of Institute of Bankers, Vol. XX., p. 376. As to its exclusion by non-negotiable crossing, compare Great Western Rail. Co. v. London and County Banking Co., [1901] A. C. 414.
