— —— Part
III.
Business of Banking.
699
now
is doubtful (d). It would seem to constitute an undertaking by the banker to honour cheques to the amount of the bills (e). A banker is not justified in negotiating bills, whether indorsed by the customer or not, which have been paid in for collection (/), at any rate unless the state of the customer's account renders it a reasonable thing to do so (g). A banker who collects a bill to which his customer has no title_ is hable to the true owner in trover or for money had and received to the face value of the bill, and has no statutory protection whatever (Ii). ^
Sect.
5.
Sect.
4.
Collection of Bills of
Exchange, Negotiation
by banker.
No
protection
^^^j. has nTtitle.^^
Collection of other Documents.
Sub-Sect.
1.
Orders for Payment.
1224. An order for payment drawn by a customer on his banker Orders for payable conditionally on the payee's signing a specified attached payment, receipt is not a cheque (i). Such documents are not negotiable, and if the collecting banker has received the amount payable under any of such documents in circumstances constituting conversion of the document he is liable to the true owner for the face value (k). The crossing on such documents has generally been regarded Crossing, as aftbrding both collecting and paying bankers the same protection as the crossing on cheques, and as imposing the same duties on the latter. This would appear to be the case {I) except that a collecting
(d) The doctrine that crediting cheques as cash makes the banker holder for value ipso facto, applied to cheques in Capital and Counties Bank v. Gordon, [1903] A. C. 240, lias never yet been applied to bills not due. {e) Thompson v. Giles (1824), 2 B. & C. 422, at pp. 429, 431. (/) Thompson v. Giles, supra; Collins v. Martin (1797), 1 Bos. & P. 648, at p. 649 Ex parte Barkiui<rth, Be Harrison (1858), 2 De G. & J. 194. (g) Negotiation in some such circumstances is clearly contemplated in Thomp)son V. Giles, supra, ^qq per Bayley, J., at p. 429: "The banker could only be justified in negotiating them when that was rendered a reasonable course by the state of the customer's account." See also per Holroyd, J., at p. 432 and compare Ex parte Barhworth, Re Harrison, supra. But it is submitted that the right only arises when there has been agreement, express or implied, that the bills may be so dealt with on contingencies which have arisen. The proper course is to hold and collect the bills wiien due and retain the proceeds by virtue of set-off. (/i) Arnold v. Cheque Bank (1876), 1 C. P. D. 578, at p. 585. The suggestion there of handing over the money to the customer cannot be supported in view of the later cases, e.g., Fine Art Society v. Union Bank of London (1886), 17 Q. B. D. 705 Capital and Counties Bank v. Gordon, [1903] A. C. 240. {i) Capital and Counties Bank v. Gordon, supra, at p. 252 (instruments in class 8) Bavins, junr. and Sims v. London and South Western Bank, [1900] 1 Q. B. 270. Bavins, junr. and Sims v. London and South Western Bank, supra ; Capital (/;;) and Counties Bank v. Gordon, supra. Compare Bevenue Act, 1883 (46 & 47 Vict, " Provided that nothing in this Act shall be deemed to render any c. 55), s. 17 such document a negotiable instrument." See also Gordon v. London City and Midland Bank, [1902] 1 K. B. 242, per Collins, M.R., at p. 275. See Bavins, junr. and Sims {I) Revenue Act, 1883 (46 & 47 Vict. c. 55), s. 17. V. London and South Western Bank, supra ; Gordo7i v. London City and Midland Bank, supra, at pp. 275, 282. Certain expressions used by Lord Lindley in the latter case, [1903] A. C. at p. 252, and concurred in by the other law lords, might seem to imply that the Revenue Act, 1883, s. 17, does not apply to these documents
