— Bankers and Banking,
614 Sect.
7.
Protection to Bankers
It is not unusual for bankers to take indemnities (c) from customers with regard to paying these documents, which, not being cheques, they are under no primary obUgation to honour.
paying Cheques leques. Bills accepted payable at a
banker's.
Bearer
—
bills.
Forged acceptance.
Forged indorsement.
Liability to true owner.
Sect.
8.
Payment of
Bills accepted payable at a Banker'
1245- Where a customer accepts a bill payable at his banker's (d), constitutes an authority to the banker to pay it at maturity (e), and if no funds are available, amounts to a request for an overdraft to the amount, but in the absence of previous arrangement, the banker is under no obligation to pay the bill, even though he have sufficient it
funds in hand (/). A banker who in good faith and without negligence pays a bill payable to bearer so accepted to the bearer thereof can charge his customer with the amount (g). A banker who has paid a bill on a forged acceptance cannot charge his customer with the amount unless the customer is precluded from disputing his signature by estoppel or adoption (h). A banker who has paid a bill on a forged indorsement cannot charge his customer unless the customer is estopped from disputing Negligence on the part of the customer directly the payment (i). leading to or enabling the loss, or a representation made to the banker by the customer on a material point on which the banker acted by paying money which he would not otherwise have paid, might constitute such estoppel {k). But acceptance of a bill on which the payee's indorsement has been forged does not estop the customer from refusing to be debited (Z). If, however, the payee is a fictitious or non-existing person, the and so charge banker may treat the bill as payable to bearer his customer, notwithstanding the forged indorsement. Where a banker has paid a bill on a forged indorsement, he is For form, For form
of indemnity, see Encyclopsedia of Forms, Vol. II., p. 501. of such acceptance, see Encyclopsedia of Forms, Vol. II., p. 502. (e) Kymer v. Laurie (1849), 18 L. J. (q. b.) 218. Bank of England v. (/) Robarts v. Tucker- (1851), 16 Q. B. 560, at p. 579 Vagliano, [1891] A. C. 107, per Lord Macnaghten, at p. 157. (g) Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), ss. 2, 8 (3), 59. (h) Bank of England v. Vagliano, siipra, per Lord Selborne, at p. 124. (i) Robarts v. Tucker, supra ; Bank of England v. Vagliano, supra. There is no protection in such case for the banker similar to that given by sect. 60 of the Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), with regard to cheques, or by sect. 19 of the Stamp Act, 1853 (16 & 17 Vict. c. 59), with regard to drafts or orders payable to order or demand drawn on a banker. See also Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), s. 24. As to what may constitute such estoppel, see Bank of England v. Vagliano, supra, particularly at pp. 114 124. [k) See Bank of England v. Vagliano, supra. The banker acts as agent for the (c)
{d)
customer in paying domiciled bills, and as such is entitled to the protection and consideration usually accorded to an agent. (l) Robarts v. Tucker, supra. " The bill may (m) Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), s. 7 (3). be treated etc.," i.e., by anyone to whose interest it is so to treat it, which includes the paying banker (Bank of England v. Vagliano, supra). As to when the payee «omes within this definition, see, further, Vinden v. Hughes, [1905] 1 K. B. 795 ; Macbeth v. North and South Wales Bank, [1906] 2 K. B. 718, and note {m), p. 608, ante.
