This section of the book is from the "Canadian Banking Practice" book, by John T. P. Knight.
Question 464.— Re sec. 74, Bills of Exchange Act: (1) What constitutes notice of a customer's death? (2) Would a bank be justified in refusing payment on the strength of one of its officers having heard of a customer's death?
Answer.— (1) Any information received by the bank from which the death of the customer may be fairly inferred, must be held to constitute notice of his death.
(2) Generally speaking, any information received by an officer of the bank which is within the conditions would not only justify the refusal of the cheque, but would put on the bank the burden of paying the cheque, if paid, at its own peril; i.e., if it should prove that the information is correct the bank would not have the right to charge the cheque to the customer's account.
Whether information which has reached any officer of the bank is to be regarded as knowledge on the part of the bank would depend somewhat on the circumstances, the position of the officer, etc.