Bankers and Banking.
616 Sect.
9.
Forged or Altered Cheques. Customer's duty.
Estoppel.
Adoption.
would seem that the banker
is entitled to debit the customer with the amount originally inserted {t). There is a duty owing by the customer to the banker with regard to the filling up of cheques, but it has never been defined (w). Leaving blank spaces which can be, and are, fraudulently utilised to raise the amount of the cheque is no breach of this duty and the banker cannot debit his customer with, at any rate, the excess (a).
1247. The doctrine that a forgery cannot be ratified probably only applies to criminal law [h). A man may by conduct be estopped from denying his signature or held to have adopted the forged instrument. If he consciously pays a cheque to which his name has been forged, he is not estopped from disputing a subsequent forgery by the same hand unless the repetition of such payment establishes a course of business authorising the use of his name (c). Any conduct on the part of the customer directly leading the banker to pay a cheque on which the customer's name had been forged, or which had been fraudulently altered, would estop the customer from subsequently questioning the payment (<i). If a man knows, or has reasonable ground for believing, that his signature has been forged to a cheque, and that it is about to be presented to his banker for payment, he is bound to warn the banker of If he fails to do so within reasonable time, and the banker's the fact. position is thereby altered, he is held to have adopted the cheque (e). The duty does not indeed seem confined to a customer of the banker, but to extend to any person who knows that a document bearing a forged signature 23ui'poi^"ting to be his is about to be presented to a banker for payment (/). Vance y. Lowther (1876), 1 Ex. D. 176), but it would be unreason61), s. 64 (2) able if the alteration to an earlier date debarred the banker from debiting the customer, if paid after the original date. (t) See cases cited note (r), p. 615, ante. (u) Colonial Bank of Australasia v. Marshall, [1906] A. C. 559, at p. 567 Scholfiekl V. Earl of Londeshorough, [1896] A. C. 514 (where there was not the relation of mandator and mandatary) Lewes Sanitary Steam Laundry Co. v. and compare Young v. Grote (1827), Barclay t£- Co. (1906), 11 Com. Cas. 255 4 Bing. 253, which, however, cannot now be treated as authority. (a) Colonial Bank of Australasia v. Marshall, supra ; Scholjield v. Larl of Londeshorough, supra; Societe Generale v. Metropolitan Bank (1873), 27 L. T. 849. "People are not supposed to commit forgery, and the protection against forgery is not the vigilance of parties excluding the possibility of committing forgery, but Young v. Grote, supra, and Marthe law of the land " ( j3«r Bovill, C. J., at p. 856). cussen v. Birkheck Bank (1889), 5 T. L. E. 179, 463 (Divisional Court), 646 (Court of Appeal) (see also Journal of Institute of Bankers, Vol. XI., p. 403), are overruled. (b) See M'Kenzie v. British Linen Co. (1881), 6 App. Cas. 82, _per Lord Blackburn, at p. 99. Compare, however, Brook v. Hook (1871), L. R. 6 Exch. 89. (c) Morris v. Bethell (1869), L. R. 5 C. P. 47. {d) See further on this point, title Estoppel. reason(e) M'Kenzie v. British Linen Co., supra, specially at pp. 91, 109, able ground for believing," ;per Lord Selborne, at pp. 92, 95 ; Ogilvie v. West Australian Mortgage and Agency Corporation, [1896] A. C. 257, specially at p. 270. In Cairncross v. Lorimer (1860), 3 Macq. H. L. 827, at p. 830, Lord Campbell appears to consider actual knowledge necessary for adoption. (/) M'-Kenzie v. British Linen Co., supra, was not in fact the case of a customer, but of a stranger, as appears from the report. It is, however, treated as the case of a customer and explained on that ground in Ogilvie v. West Australian c.
Mortgage and Agency Corporation, supra.
In Ewing
v.
Dominion Bank
(1904),
