— — Bankers and Banking.
602 Sect.
5.
Collection of other
Documents. Bankers' drafts.
Stjb-Sect. 4.
1227. Drafts payable on demand drawn by a branch office on the head office of the same bank, or vice versa, are not cheques (i). They are, however, presumably negotiable {k). A banker receiving payment in circumstances amounting to conversion is liable to the true owner for the face value. They are not susceptible of effective crossing {I), and ostensible crossing affords no protection to the If, however, collected by the bank on which they collecting banker. are drawn, the bank as a whole is protected if it has paid them on a forged indorsement {m), whether the draft be inland or foreign {n). A draft drawn by one bank on another is a cheque, and may be crossed and dealt with as such. Sect.
Payment
of
cheques.
Bankers' Drafts,
6.
Payment of Cheques.
1228. A banker is bound to pay cheques drawn on him by a customer in legal form provided he has in his hands at the time sufficient and available funds for the purpose (o). He must either pay them or refuse payment at once a request to re-present amounts to dishonour Post-dated cheques are not invalid {q), but the banker should not pay such a cheque if presented before its ostensible date (r). So
Post-dated cheques.
[i] Capital and Counties Bank v. Gordon, [1903] A. C. 240 Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), ss. 3, 73. So that, in the absence of a forged {k) Bills of Exchange Act, 1882, s. 5 (2). indorsement, an independent title may be set up where circumstances admit. (Z) Qucere whether this is implied by Lord Lindley in Capital and Counties Bank v. Gordon, supra, at p. 250. Only " cheques " can be crossed under the Bills of Exchange Act, 1882, and "cheque" is defined as a bill in sect. 73, differing from previous crossed cheques legislation, which applied to " draft or order drawn on a banker." There is no statutory provision for applying to them the crossed cheques sections. Capital and Counties Bank (m) Stamp Act, 1853 (16 & 17 Vict. c. 59), s. 19 V. Gordon, supra, at p. 250. (n) It has been contended that the section, occurring in a Stamp Act, can only apply to inland drafts, but the enactment, though in the form of a proviso, is perfectly general in its terms. The fact that it is a proviso does not prevent its being a substantive enactment ( Matthiessen v, London and County Bank (1879), 5 C. P. D. 7). The Court of Chancery (Funds) Act, 1872 (35 & 36 Vict. c. 44), s. 11, refers to this enactment as relating to "the indorsement of drafts or orders drawn upon bankers for the payment of money," without specifying inland drafts. In Broivn, Brough Co. v. National Bank of India (1902), 18 T. L. R. 669, BiGHAM, J., clearly thought it applied to foreign drafts, and his ruling was not dissented from by the House of Lords in Capital and Counties Bank v. Gordon, supra, see p. 251. Whitaker v. Bank of England (1835), (o) Foley v. Hill (1848), 2 H. L. Cas. 28 As to 1 Cr. M. & Marzetti v. Williams (1830), 1 B. & Ad. 415). at p. 750 funds available, see p. 605, post. (p) Bank of England v. Vagliano, [1891] A. C. 107, see per Lord Bramwell at p. 141, per Lord Macnaghten at p. 157, dissenting from dictum of Madle, J., in Roharts v. Tucker (1851), 16 Q. B. 560, at p. 578. {q) Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), s. 13 (2), even in the hands of a holder who has taken a post-dated cheque before the ostensible date {Carpenter v. Street (1890), 6 T. L. R. 410). Nor can an objection to the sufficiency of the stamp prevail if action is brought after the ostensible date {Royal Bank of Scotland v. Tottenham, [1894] 2 Q. B. 715). '(r) Da Silva v. Fuller (1776), unreported, see Sel. Cas. MS. 238 ; Morley v. Culverwell (1840), 7 M. & W. 174, per Parke, B., at p. 178.
K
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