This section of the book is from the "Canadian Banking Practice" book, by John T. P. Knight.
Question 114.— A cheque which has been dishonoured is handed by a bank to a solicitor for collection. On presenting it at the bank on which it is drawn, he is informed that the party has just made a deposit, and payment is offered. He has the cheque marked good, however, and takes it to his own bank, who declines to receive it because it still appears to be the property of the bank for whom he is acting. He returns to the drawee bank and asks them to pay it, whereupon they cancel the acceptance and inform him that it was given under a mistake; that although the party made a deposit it was to cover a previous overdraft, and there were still no funds. Had the bank a right to cancel their acceptance?
Answer.—The question is asked with reference to a cheque drawn on an American bank. In the United States it seems to be admitted that under such circumstances the bank would have a right to cancel the certification of the cheque. See "Daniel on Negotiable Instruments," 4th edition. The passage is too long to quote, but is to the effect that the certification of a cheque may be revoked provided no change of circumstances has occurred which would render it inequitable for such a right to be exercised.
The point seems never to have come up in a Canadian court, and here it may be urged against this view, that an acceptance completed by delivery is irrevocable, and that the ordinary mode in Canada of marking a cheque good is in effect an acceptance. It is not clear, however, that the same results would not follow here as in the United States.