— Paet
III.
Business of Banking.
611
The fact that a crossed cheque has been refused payment does make it an open cheque for the purpose of re-presentation (^).
not
^'
Protection
to Bankers protected if he pay a cheque in accordance paying with its ostensible crossing, if any, notwithstanding the same may Cheques, have been obhterated, added to, or altered otherwise than as authorised by the Bills of Exchange Act, 1882 (r). "Addition" accordance must mean a material addition, effective under the crossed cheques with the ^^O'^^^^gsections; the addition of a memorandum such as "Account payee" would not justify the banker in refusing to pay the cheque, or in itself deprive him of protection in paying (s); nor does such addition have any direct effect on the paying banker {a). The " opening " a crossing, i.e., writing " Pay cash " and initialling, is a patent alteration not authorised by the Act, and a banker pays such a cheque over the counter at his own risk should the opening prove unauthorised. No right accrues to the true owner by the use of such wwds under sect. 79 of the Bills of Exchange Act, 1882 {b). A banker paying a crossed cheque in good faith, without negii- Extent of gence, and in accordance with the crossing, is protected, and can Protection, debit his customer, notwithstanding any defect of title in the collecting banker or the person from whom he received it (c). If the cheque had come to the hands of the payee (d), the drawer is discharged both on the cheque and on the consideration (e). Protection under the crossed cheques sections might be doubtful in the case of an open cheque crossed by a person having no authority to cross, e.g., an innocent person in possession under a forged indorsement, but the banker would be otherwise protected (/). The addition of " not negotiable " to the crossing has no effect " Not negotiable " by itself, whatever on the paying banker. however, does not constitute a crossing {g). The banker's identification stamp may or may not be a crossing. If impressed on an open cheque by the collecting banker, it probably
1240.
A
Bank
(1906), thereof. (q) It
banker
is
23 T. L. R. 65, as to adoption of a payment by taking the benefit
remains a crossed cheque
compare Questions on Banking Practice,
No. 432. (r) Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), s. 79, proviso. The proviso defectively drawn. " To have been added to or altered" etc., grammatically refers to the cheque, not the crossing, but the v^^ords are intended to apply to the latter. (s) See Ahrokerri {Atlantic) Mines, Ltd. v. Economic Bank, [1904] 2 K. B. 465, 'per BiGHAM, J., at p. 472. The paying banker could, as a rule, have no [a) Ihid» ; and see p. 595, ante. is
knowledge for whose account the cheque was being collected. The only doubtful case would be where the cheque bore several indorsements after that of the payee, Qucere, whether payment in such case would be "in and one was forged. the ordinary course of business " or " without negligence." (6) The section only mentions definite recognised crossings. (c) Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), s. 80. [d) It is presumed that "constructive" coming to payee's hands
would be
sufficient. (g)
Exchange Act, 1882 Compare Simmons v. Taylor
Bills of
(45
&
46 Vict.
c.
61),
s.
80.
528, j9e?-CRESSWELL, J.,afc Bat if the cheque is an order cheque, the p. 539 ; affirmed, 4 C. B. (n. s.) 463. banker is protected under sect. 60, if a bearer cheque, by having paid to bearer. (g) See definitions in Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), s. 76. (/)
(1857), 2 C. B. (n.
s.)
R R 2
