This section of the book is from the "Canadian Banking Practice" book, by John T. P. Knight.
Question 3.— A. deposits with a bank a sum of money in open account, upon which he from time to time issues cheques. At length, however, he accepts a draft, making it payable at the bank where his funds are. When the bill falls due and is presented at the bank for payment is the bank bound to pay for it, the acceptor's account being in funds but no authority having been given the bank to charge acceptances to his account ?
Answer.—In Bank of England v. Vagliano, the judgment of Macnaghten, L.J., contains the following statement of the law in the matter:
" The relation of banker and customer does not of itself, " and apart from other circumstances, impose upon a banker "the duty of paying his customer's acceptances.
" If authority is wanted for this proposition it will be " found in Robarts v. Tucker, where it was said by the court " that ' if bankers wish to avoid the responsibility of deciding "' on the genuineness of endorsements, they may require "' their customers to domicile their bills at their own offices, "' and to honour them by giving a cheque upon the banker.' " That implies that bankers may refuse to pay their cus-"tomer's acceptances, and that such refusal is not inconsistent with the relation of banker and customer, or a " breach of the banker's duty to his customer."
"If a banker undertakes the duty of paying his customer's acceptances, the arrangement is the result of some " special agreement, expressed or implied."
The answer to the question would therefore be that in the absence of special circumstances governing the case, the bank would not be bound to pay its customer's acceptance in the case mentioned, but it would be entitled, having paid it, to charge the amount to his account.