—— Part
III.
Business of Banking.
629
A
banker who receives goods for custody at his bank is in removing them elsewhere for safe keeping, and would be liable for any loss occurring while deposited elsewhere {e).
1269.
not
jiistitied
Sect. 15.
Safe
Custody
oi
Valuables.
Sect.
16.
Discounting Bills,
Removal.
1270. A banker discounts a bill, as opposed to taking it for Discounting collection or as security for advances, when he takes it definitely bills. and at once as transferee for value. It does not matter that the amount of the bill, less discount, is carried to current account. In the case of a customer that is the usual course. Whether the bill taken from a customer for collection or as security, or discounted for him, is a question of fact (/). The presumption in favour of a negotiated bill being taken by way of absolute transfer rather than of pledge or security is not so appropriate in the case of banker and customer as in other cases. Indorsement of a specially indorsed bill is as necessary for collection as for absolute transfer. Even indorsement by the customer of a bill indorsed generally is consistent with his merely putting his name on it as extra security (g). Subject to doubts raised by a recent decision (h), the entry of the amount of such bills, less discount, as cash in the banker's books would only be evidence of the banker having taken them as Possibly inferences might be drawn from whether the transferee. bank held itself out as a discounting bank or not (i). Where the transaction is really one of discounting, the banker is of course at liberty to deal with the bill as he pleases, rediscounting or transferring it. is
1271. Where the banker has the customer's indorsement on the Eemedies of he has the remedies of an indorsee against him; where he banker against has not got the customer's indorsement on the bill, he only has customer. against him the remedies of a transferee by delivery {k). Mere dishonour of a bill not indorsed by the customer gives no right to debit the customer's account or to proceed against him on the bill (Q. Instead of indorsing each bill for discount separately, the customer sometimes gives to the banker a general guarantee of all bills discounted for him, which has the same operation as specific indorsement in each case {m). The fact that bills have been discounted by the banker for a Eemedies customer, which bills are still running, gives the banker no right against customer's to retain moneys due to the customer as a provision against account. such bills {n), except perhaps in the event of the customer's bill,
See Lilley v. Douhleday (1881), 7 Q. B. D. 510. (/) See p. 622, ante. ig) See Ex parte Schojield, Re Firth (1879), 12 Ch. D. 337. (h) Cajjital and Counties Bank v. Gordon, [1903] A. C. 240 (e)
compare Dawson
[1906] 1 C^h. 636. (i?) See Gaden v. Newfoundland Savings Bank, [1899] A. C. 281. (k) See title Bills of Exchange etc. {I) The dicta as to debiting a dishonoured cheque, though credited as cash, in Capital and Counties Bank v. Gordon, supra, at p. 248, could not be applied to a discounted bill. (m) Ex parte Bishop, Re Fox, Walker dc Co. (1880), 15 Ch. D. 400. For form of (n) Bowen v. Foreign and Colonial Gas Co. (1874), 22 W. R. 740. V. Isle,
