This section of the book is from the "Canadian Banking Practice" book, by John T. P. Knight.
Question 323.— A is promissor on a note in favour of B, which is overdue and is held by a bank, having been duly endorsed by B. A creditor of B's serves a writ of garnishment on A for the amount due on the note. Can A safely pay the bank which holds the note, he being ignorant whether the bank holds it for value or merely for collection on account of B.
Answer.—The promissor is bound to pay the holder of the note. If B has any interest in the moneys after they are collected, his creditors might take proceedings to attach it in the hands of the bank. A, however, is protected if he pays the note to the holder.
Goods Sold in England by Canadian Firm, to be Drawn for Plus Expenses—Form of Draft.
Question 324—A Canadian firm sell in England goods at a cost of $1,000, for which they are to draw at sight, covering every expense. Should they draw for $1,000 plus charges in Canadian currency, or for sterling amount, and if the latter at what rate of exchange?
Answer.—We think they might draw for the amount in currency, but in practice it would be more convenient to draw for such amount in sterling as would yield $1,000 at the current rate for sight bills.