Question 188. - 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 acceptance to his account?

Answer. - In Bank of England v. Vagliano (1891), A. C. 107, 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 (1851), 16 Q. B. 560, where "it was said by the court that 'if bankers wish to avoid the "'responsibility of deciding on the genuineness of endorse-"'ment, they may require their customers to domicile their "'bills at their own office, and to honour them by giving a "'cheque upon the banker.' That implies that bankers may "refuse to pay their customer's acceptance, 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 customi "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 in the case mentioned, but it would be entitled, having paid it. To charge the amount to his account acceptances payable at a bank - right to charge to customer's account at maturity.

Question 189. - Has a bank a right, without special instructions, to charge to the customer's account at maturity, a note or acceptance which he has made payable at the bank? 1s such a note or acceptance to be regarded as an order on the bank to pay the same?

(2) Would your answer apply to past due notes or acceptances?

Answer. - A customer who makes his acceptances payable at a bank thereby authorizes the bank to pay the same at maturity, but it is clear that such an acceptance only gives authority to pay, and does not impose a duty.

Duty to pay a customer's acceptance for which sufficient funds are not at hand might, however, arise out of the course of dealing between him and the bank.

(2) The bank should not pay an overdue acceptance without instruction from the acceptor. His relations to the other parties on the bill may be completely changed by its being overdue.

(Note. - It has been said that in the Province of Quebec a customer's note cannot be charged to his account except with his special authority, and above answer is without reference to that province).