generally they fall within the other principles relating to notice of dishonour of bills of exchange (z). A stakeholder who cashes a cheque deposited with him is not, if the parties agreed to treat the cheque as money, guilty of a breach of duty (a). A cheque was within the Bills of Exchange Act, 1855, 18 & 19 Vict. c. 67 (b); but the operation of this Act was suspended by Ord. II. r. 68, and now the Act itself is repealed by the Statute Law Amendment Act, 1883, 46 & 47 Vict. c. 49, s. 3, as to actions in the High Court. A cheque may be taken in execution (c). The statute 16 & 17 Vict. c. 59, s. 19, first introduced drafts on a banker payable to order on demand. CHAPTER III. Right to cash a cheque. Within Bills of Exchange Act. Execution. Cheques payable to order. ing. The statute enacts, that the banker who pays the bearer is Protection to not to be responsible for the genuineness of the indorsement, banker payas he would have been if it were an ordinary bill of exchange, but, on the other hand, the bearer cannot charge the drawer without making title through the first indorsement as he could on an ordinary cheque payable to bearer (d). An indorsement by an agent in fraud of his principals is within this section (e). (-) Code, s. 73; Grant V. Vaughan, 3 Burr. 1516. See the remarks of Lord Ellenborough in Rickford v. Ridge, 2 Camp. 539; Byles on Bills, 6th American ed., 37 and 445; Code, ss. 48 and 73. It has been already noticed that the Code in defining a "cheque " does not use the word "inland"; hence if a cheque be drawn abroad and show that on its face, like any other foreign bill, it may require to be protested or noted in addition to the notice of dishonour in order to preserve the remedies against the drawer and indorsers. Code, s. 51 (2). Whatever excuses notice of dishonour also excuses protest. Sect. 51 (9) and 50 (2) c. As to the stamp, see, however, Ex parte Boyse, 33 Ch. D. 612. (a) Wilkinson v. Godefrey, 9 Ad. & E. 536. (b) Eyre v. Walker, 29 L. J., Ex. 246; 5 H. & N. 460. This statute still applies to cases involving 107. or upwards in the (c) 1 & 2 Vict. c. 110, s. 12 ; (d) The banker only is protected, not third parties. Ogden v. Benas, L. R., 9 C. P. 513; Arnold v. Cheque Bank, 1 C. P. D. 578. (e) Charles v. Blackwell, 2 C. P. D. 151. CHAPTER Extended to bills on demand. Crossed cheques. A similar protection is also accorded by the Code, s. 60, to a banker paying in good faith, and in the ordinary course of business a bill of exchange drawn on him payable to order on demand; he is not responsible for the genuineness or validity of any indorsement, and is deemed to have paid the bill in due course though the indorsement be a forgery or without authority. A banker's draft payable to order is now very commonly used for remittances by post or otherwise. No innocent transferee for value can succeed in an action against the drawer, unless he derive title through the payee's indorsement. The drawer is therefore, in an action against himself, on the cheque, protected by the ordinary consequences of forgery, civil and criminal. While in an action by himself against his own banker for the balance of his account, the banker, when he sets up as an answer the payment of the cheque, is at all events in no better position than he would have occupied had the cheque been originally made payable to bearer. Indeed, cases may be imagined in which the forged indorsement may assist the drawer in proving collusion or gross negligence against the banker. It has long been a common practice, not only in the city of London but throughout England, to write across the face of a cheque the name of a banker. The meaning of this crossing was to direct the drawees to pay the cheque only to the banker whose name was written across; and the object was to invalidate the payment to a wrongful owner in case of loss: but it has been held that at common law the effect is to direct the drawees to pay the cheque not to any particular banker, but only to some banker, and not to restrict its negotiability. Therefore, as between the banker and his customer, the circumstance of the banker paying a crossed cheque, otherwise than through another banker, is at common law strong evidence of negligence on the part of the banker, rendering him responsible to his customer (f). The holder may at common law erase the name of the banker and either substitute that of another banker, or leave the words and Co. remaining alone (g). It is also not unusual to write the words and Co. only, in the first instance, leaving the particular banker's name to (ƒ) Bellamy v. Majoribanks, 7 Exch. 389; Carlon v. Ireland, 25 L. J., Q. B. 113; 5 E. & B. 765. (g) Stewart v. Lee, 1 M. & M. 158 Bellamy v. Majoribanks, supra. But see 21 & 22 Vict. c. 79 infra. be filled up afterwards or not, so as to insure the presentment CHAPTER by some banker or other (h). The former Acts regulating crossed cheques were repealed, and substantially re-enacted by the 39 & 40 Vict. c. 81, existing rights being preserved (i), which Act also is now (h) Boddington v. Schlenker, 4 B. & Ad. 752; 1 N. & M. 540, S. C.; 38 R. R. 360; Carlon v. Ireland, supra. C. drew a cheque on his banker, payable to A. and B., assignees of C., or bearer, and wrote the name of their bankers across it. B., who had another private account with the banker, paid the cheque into that account: it was held, that the bankers were justified in applying it to that account, the drawer's writing the name of the bankers of the payees of the cheque across it not being, according to the custom of trade, information to the bankers that the money was the money of the payees. (i) Those Acts were the 19 & 20 Vict. c. 25, and the 21 & 22 Vict. c. 79. The former of these enacted that where a draft payable to bearer, or order, on demand, bore across its face the name of any banker, or the words "and Co." between two transverse lines, such draft should only be paid to or through some banker, but the negotiability of the cheque was not affected. The Court of Common Pleas in Simmons v. Taylor, 27 L. J. 45; 4 C. B., N. S. 463, held that under this Act the crossing was no part of the cheque, and its fraudulent alteration no forgery, and, therefore, that the payment without negligence to a holder, not being a banker, of a draft, the crossing whereof had been fraudulently obliterated, was good as between the banker and his customer. The 21 & 22 Vict. c. 79, accordingly, enacted that the crossing should be a part of the cheque, and its fraudulent obliteration or alteration forgery. That a cheque once crossed with a banker's name was thenceforth only payable through him, and further, that payment made without negligence of a draft, the crossing of which had been obliterated or altered, should not be questioned. Neither of these Acts affected the negotiability of cheques, so that a payment made to a wrong banker, provided it reached the rightful holder, was good. Smith v. Union Bank, L. R., 1 Q. B. D. 31 ; 45 L. J. 49; where a crossed cheque indorsed in blank was stolen, and ultimately presented by a bona fide holder through another bank than that named in the crossing. The drawees, who paid it in disregard of the statute, were held not to be liable in an action at the suit of the loser, as he was not the holder, nor was there any privity of contract or statutory duty as between him and them; and his loss was in no way occasioned by their act, inasmuch as they had paid the rightful owner, though through a wrong channel. This case led to the passing of the late stat, 39 & 40 Vict. c. 81. It is conceived that it always has been competent for a man to draw a non-transferable cheque ; this he could formerly have done by simply omitting the words "order or bearer" in which case the payee could indorse so as to make himself, but not the original drawer, liable to the indorsee. Now, however, as those words are no longer necessary to create negotiability, it follows that their mere absence will not restrain it; and, accordingly, if a man wishes to draw or indorse an instrument so that its negotiability is restrained, he must use words expressing that intention, as "pay D. only," or "pay D. for suchand-such an account." Code, ss. 8 and 35. In the National Bank v. Silke, 1891, 1 Q. B. 435; 60 L. J. 199, the Court, while III. CHAPTER repealed and the provisions in the Code substituted in its place. III. Not negotiable cheques. The present law as to crossed cheques. The 39 & 40 Vict. c. 81, first introduced "not negotiable " cheques, that is to say, instruments which are freely transferable, but to which a bona fide holder for value does not acquire a new and independent title, but can only have or pass on such title as his transferor possessed (k). This provision must greatly lessen, if it does not entirely remove, risk from theft or loss, as a thief or finder can have no title, and therefore cannot convey one. 66 The The 76th and six following sections of the Code contain the present law, which seems to apply equally to cheques to order and to bearer, as the words used are a cheque." Act of 1876 expressly included both by sect. 3. Two parallel lines across the face of a cheque, whether containing or not the words "and Co." and with or without the words "not negotiable," constitute a general crossing (1). If the name of a banker be written across the face of a cheque, with or without the words "not negotiable," that cheque is crossed specially and to that banker (m). Either the drawer or the holder may cross generally or specially, and the latter may convert a general into a special crossing, or add the words "not negotiable" (n) if he choose, when the drawer has not done so. A banker, to whom a cheque either uncrossed or crossed generally is sent for collection, may cross it specially to himself (o); but a banker alone can recross specially to another banker for collection a cheque already crossed specially ( p). doubting whether a cheque to (k) Code, s. 81, is to the same (4) Code, s. 76. It seems that only crossed cheques can be marked "not negotiable," as both this and the following sections 77 (4) and 81 only authorize the insertion or subsequent addition of those words where cheques are crossed, but it is immaterial whether the crossing be general or special. (m) Sect. 76 (2). The two parallel transverse lines seem therefore not to be absolutely necessary in the case of a special crossing, though it is usual to add them. (n) Sect. 77 (1), (2), (3), (4). (0) Ib. (6). (p) Ib. (5). (*) The sees of the pages 3 und orsed by cheque into his our afe. He had nd no previous cheques of the Co. into his afe. The bank credited him with out Enquiry, d III. Liability of In any other case where a cheque is crossed specially to CHAPTER Where a banker pays in good faith and without negligence Protection to i.e. my in collecting, not in tenis, a/c. (1900). A.C. 683 A banker bona fide receiving payment for a customer of a cheque crossed either generally or specially to himself, shall not, in case the customer's title to the cheque prove defective, incur any liability to the true owner of the cheque, by reason only of having received such payment (u). (g) Sect. 79 (1). (r) Sect. 79 (2). (t) Sect. 80. (u) Sect. 82. See the judgment of Lindley, J., in Matthiesson v. London and County Bank, L. R., 5 C. P. D. 7 (a case under the repealed statute), as to what conduct of a banker would amount to more than merely receiving such payment. In Kleinwort v. The Comptoir D'Escompte de Paris, 1894, 2 Q. B. 157; 63 L. J. 674, the collecting bankers who received the money and paid it, not to a customer, but a stranger claiming under a forged indorsement, were held liable for a "conversion." In La Care v. The Credit Lyonnais, 66 L. J. 326; 1897, 1 Q. B. 148, where the defendants were bankers in London and Paris, a cheque crossed generally, drawn on the London branch, was lost in the post, and presented at the Paris of.16417 Vict. 8.59. includes person open afe by paying cueingestio 19207 A.2.683 A for many years cashes crowed cheeque at a bank Ahild not •afe.. a has no customer. Cr.W. Bly. + County) v. London + Bank. 11899/20.8. m [190072-Q-3.464 [1901A.C. 4/4. a banker who makes himself hol`s for value; 6.g. by eveciting the istomes, is not protseted. acleque cromed by t vcificul bauten is not a "croned cheer. Capital. Counties Bank *. ford on [1903] A.C.240, a baker sex how to customer cheques, cronce ft ubrally, of M indorsements were mad The credited min cured the conversion. So a banker, if he stick books, have no notice of a trust, is When the banker receives payt for a custonce of a croued cheque |