Simulación del efecto en los campos receptivos de una lesión retinal

Though the primary relationship between a banker and his customer is that of a debtor and a creditor or vice versa, the special features of this relationship, impose the following additional obligations on the banker.

1. Obligation to honour the cheques: The deposits accepted by banker are his liabilities repayable on demand or otherwise. The banker is therefore, under a statutory obligation to honour his customer’s cheques in the usual course. Section 31 of the Negotiable Instruments Act. 1881, lays down that:

“The drawee of a cheque having sufficient funds of the drawer in his hands, properly applicable to the payment of such cheque must pay the cheque when duly required to do so and in default of such payments must compensate the drawer for any loss or damage caused by such default.

Thus, the bankers is bound to honour his customer’s cheques provided the following conditions are fulfilled:

i) There must be sufficient funds of the drawer in the hands of the drawee. By sufficient funds is meant funds at least equal to the amount of the cheque presented. The funds must be sufficient in the hands of he banker.

Generally, the cheques sent for collection by the customer are not related as cash in the hands of the banker until the same are realized. The banker credits the amount of such cheques to the account of the customer on their realization.

A banker should, therefore, be given sufficient time to realize the amount of the cheque sent for collection before the said amount is drawn upon by the customer. If the customer draws a cheque with the remark ‘Effects not cleared’.

Further, the credit balances in other accounts of the customer at other branches or head office of he bank need not be taken into account in computing the sufficiency of funds for this purpose. Cheques are generally payable at the branch where the account of the customer is kept and each branch of a bank of is treated as a district entity for this purpose.

It is to be noted that the funds in the hands of drawee banker must be equal to or more than the amount of the cheque presented for payment. The banker is directed by the drawer to pay a specified sum of money to the payee ant if such sum is not in the hands of the banker at the time of presentation of the cheque, the latter is under no obligation to make part payment of the cheque. He would, therefore, be justified in refusing payment of the cheque.

If the payee of the cheque makes a deposit in the account of the drawer to make up such deficiency and then presents the cheque for payment, the banker will be justified in making such payment. But the banker should not disclose to the payee the amount by which the credit balance in the drawer’s account fall sthort of the amount of the cheque, otherwise he will be liable for damage for disclosing information aobut his customer’s account to a third party.

ii) The funds must be properly applicable to the payment of the cheque. A customer might be having several bank accounts in his various capacities. But it is essential that the account on which a cheuqe is drawn must have sufficient funds. If the customer is having a debit balance in his current account, he cannot draw a cheque on the basis of his fixed deposit with the banker as the latter is a deposit under a separate agreement for a specific period and can be withdrawn in the prescribed manner and not through a cheque.

The banker’s obligation to honour the cheques is further extended if an agreement if reached between the banker and the customer, either expressly or impliedly, whereby the banker agrees to sanction an overdraft to the customer.

In such cases the banker’s obligate to honour the customer’s cheques is extended up to the amount of overdraft sanctioned by him. If the banker subsequently reduces the limit of overdraft or withdraws in altogether, he must honour the cheques issued by the customer before the notice of such reduction or withdrawal is served upon him. Sometimes an obligate also emerges out of the past practice followed by the banker. For example, if the banker has honoured the cheque of a customer on several occasions in the past without sufficient funds and later on requested the customer to make good the deficiency in his account, an implied arrangement to overdraw the account is presumed to exist. The banker should not discontinue such practice without giving prior notice to the customer.

iii) The banker must be required to pay: The banker is bound to honour the cheques only when he id duly required to pay. This means that the cheque, complete and in order, must be presented before the banker at he proper time. Ordinarily a period of is months is considered sufficient within which a cheque must be presented for

payment On the expiry of this period the cheque is treated as stale and the banker dishonours the cheque. Similarly, a post-dated cheque is also dishonoured by the banker because the order of the drawer becomes effective only on the date given on the cheque.

iv) There must be no legal bar preventing the payments of such cheques e.g., if a Granishee order is issued by a court attaching the funds in a particular account, cheques drawn against such accounts must necessarily be returned.

Garnishee order: Garnishee order is an order from the court obtained by a judgment-creditor attaching the funds in the hands of a third party due to the judgment debtor. This is subject to the condition that the funds attached must be actually due from the garnishee, i.e., the third party and in our context, the banker. However an existing debt through payable at a further date, may be attached. Thus fixed deposits coming under this category can be subject to attachment. But fixed deposits which can be withdrawn after the customer’s notice cannot be attached. The reason is simple. In such a case there is no existing debt unless and until the notice is given by the customer.

Types of orders: There are two types of orders that may be made by a court Garnishee order is only an interim order and operates as an order freezing debt. No funds are payable by the banker to the court until the order is made absolute by the court.

Since the Garnishee order attaches only the existing debt., it is possible for the banker to open new account for sums deposited subsequently and allow him to draw cheques.

The following are some of the legal decision affecting garnishee orders:

1 Where there is joint account in the name of husband and wife, such an account cannot be attached in favour of husband’s judgments creditor.

2. Funds paid into the custoemr’s account subsequent to the receipt of the order are not attachable.

3. The banker immediately, after the order is received, can exercise his right or set-off. (Tyaballe V. Atmarma) 4. Unclosed cheques previously paid into the customer’s account are not attached unless the banker by agreement or usage allowed cheques to the drawn against such accounts. (A.L Underwood Ltd. V. Barclays Bank Ltd.)

5. Partnership accounts cannot be attached unless the order is made against all the partners, or in the name of the partnership.

6. Garnhishee orders can attaché trust moneys also, provided the amount is to the customer’s credit. The reason is that such a money is a debt owing to the customer and as such attachable.

7. Balances to the credit of customer’s account at branches of the bank in a foreign country cannot be attached.

Bank’s procedure on receipt of order

1. If the order is served on the bank’s head office, then the branch where the account is held should be notified for which a reasonable time is always allowed.

2. The question of attachment does not arise, if the customer’s balance is in debit. Such an order will be withdrawn and therefore, does not warrant by action.

3. The garnishee order must state the name of the customer correctly, to enable the baker to identify the judgment-debtor. Otherwise, the bank is not bound to act upon it.

4. Customer should be advised of the order and also the banker’s intention to comply with the order.

5. When the customer is having a large balance and the attachment is for a limited amount far less than the balance, the banker can transfer the necessary amount (including court costs if any) to a separate account pending payment to the court and the customer can be allowed to operate the balance in the account. But if the order attaches

all the debts owing to the customer without limit, then his account must be stopped. Even in such a case, if the amount of the judgment debt and the costs is ascertained, the banker at his discretion can allow the customer an overdraft on a new account against the surplus balance of the garnished account.

Liability of the Banker in case of wrongful Dishonour of Cheques: A banker has the statutory obligation to honour his customer’s cheques unless there are valid reasons for refusing payments of the same. In case be dishonours a cheque, intentionally or by mistake, he is liable to compensate the customer for the loss suffered by him. According to Section 31 of the Negotiable Instruments Act, 1881, the banker is liable to compensate the drawer for any loss or damage caused by the default on his part in dishonouring the cheques without sufficient reason. The banker thus incurs heavy liability for any mistake or default committed in dishonouring his customers’ cheques.

Causes of Wrongful Dishoour: Wrongful dishonour of a cheque means a dishonour committed by mistake of by negligence on the part of the banker or any of its employees. A banker must honour the cheques of the customer so long as the latter’s account has sufficient funds. If the banker commits a mistake in his account books which reduces correct balance in the account of the customer and thus a cheque is dishonoured, the banker will be liable for such wrongful dishonour. For example, if a credit made by a customer is posted to some other account or debit entry of some body else is posted to the customer’s account, the latter will not show the correct balance.

Similarly, if a post-dated cheque is honoured by the banker before eh date of the cheque and thus the balance in the customer’s account is reduced, the banker will be liable for wrongful dishonour of a cheque subsequently presented for payment.

The banker will, however, not be responsible for wrongful dishonour if the customer makes a deposit or a credit is received by main in order to make the funds sufficient after the cheque has been dishnonoured by the bank.

Similarly, if the banker has not been furnished with the names and specimen signature of the persons who have been authorized to sign cheques on behalf of a person, company or institution, he can justifiably dishonour the cheques signed by them.

It was stated earlier that when a banker allows the customer to open a current account the stipulation is that he should not injure the customer’s credit by refusing the payment of cheques drawn against such account expect on reasonable and proper grounds. From this it naturally follows that when a customer’s credit is injured the banker has to compensate by paying damages. This has been stated in Section 31 of the Negotiable Instruments Act. 1881 (ref.

Obligation to honour customer’s mandate:). This damage is not limited to the actual loss suffered by the customer and extends to loss of credit or business reputation which entitles a customer to claim heavy damages. After an analysis of the various decisions on this point the following rules emerge.

1. The amount of damages will be more in the case of a trader customer and such damages are presumed without proof. Damages may be substantial or exemplary. In the case of non-trading customers substantial damages will be awarded only if it is proved as special damages. Gibbon V. West minister Bank Limited (1930).

In this case the plaintiff was a customer of the defendant bank and she paid a certain sum of money to her account. Which was by mistake credited to a wrong accunt by the banker. Later on a cheque issued by her was dishonoured because of this mistake. Upon the dishonour she filed a suit claiming substantial damages. But it was held that as the plaintiff was a non-trader, who had not proved any special damager, she was entitled to nominal damages only and was awarded just 40 shillings. The same view was held in an Indian case New Central Hall V.

United Commercial Bank Ltd.

2. The maxim is “smaller the cheque, greater the damage”. It must not be assumed that special damages will be awarded only if the amount of the cheque is very large. Courts have invariably awarded more damages in the case of cheques involving small amounts. The reason is simple. Customer suffers more loss of reputation when a cheque for a small amount is dishonoured. Davidson. V. Barclays Limited.

In this case the plaintiff, a book maker drew a cheque for 42-15-8. It so happened that the banker paid previously a cheque which the plaintiff had counter manded. On the account the cheque in question was returned because of insufficient funds on a suit by the plaintiff for damagers the court awarded a sum of $250.

3. The amount of damages will depend upon the history of the customer’s account. If the customer already has to his discredit one or two instances of his cheques being dishnonoured due to insufficient funds, the court may award nominal damages only.

Any additional or alternative action for the tort or libel may be brought under certain circumstances. For example if the cheque is marked “Refer to drawer”, the general view is that the words “Refer to drawer” merely inform the holder that he must approach the drawer as to the reason for the dishonour of the cheque. The old view was in case of improper dishonour with such an answer there would be breach of contract but not libel. Libel is sometimes more expensive for the banker than a breach of contract because damages are awarded without the need to prove a specific loss. Whereas if it is simply a breach of contract; such loss will have to be proved.

But in Pyke V. Hibernian Bank Ltd., where certain cheques were wrongly dishonoured by the drawee bank being marked “Refer to drawer”, it was held that the drawer of the cheque was entitled to damages of $1 for breach of contract and $ 400 for libel. The court was of the view that the words refer to drawer meaning to “no funds” amounted to libel. In Jayson V. Midland Bank (1968) the court justified the return of the plaintiff cheque marked “Refer to drawer”. But the court held that the words would have been libelous if funds had been available.

LESSON – 15