What is a Cheque? - How it should he drawn. - Dates-Post dating. - As to Stamps. - Must be payable to "Order," or "Bearer." - May be drawn for any sum in sterling Money. - Indorsement. - Presentation. - Crossed Cheques.-Bankers bound to pay Cheques. - Exceptions. - To whom the Banker is liable for negligent dishonour. - Forgeries,-Cheque not a legal tender. - Cheque in payment of a Bill of Exchange. - Cheques as evidence. - Returned paid Cheques.

The use of cheques appears to have commenced as far back as the time of the Romans, but it is difficult to fix the exact date of their introduction. The names by which they were then known were "attributio" and "prescriptio"

The advantages of the cheque system as a means of making a payment have only been appreciated, even in this country, for a comparatively short period, as we cannot discover that they were adopted to any extent before the year 1780, when the London bankers began to use them in lieu of the goldsmiths' notes, of which the issue was thereafter discontinued. Since that time the use of cheques has extended year by year, until it would probably be no exaggeration to say that in this country they are the medium by which 90 per cent. of all payments are made. Some idea of the very large amounts of money thus disbursed may be obtained by a perusal of the returns of the London Clearing House, though these include bills and other documents of less importance.

A cheque is an order addressed to a banker by his customer to pay a sum of money on demand, and provided the essential points mentioned below are noted, no particular form of words is necessary to render it legal, though the banker, after due notice given, may decline to pay cheques not drawn according to his directions. The best plan is to adhere to the printed form now issued by all bankers to their customers, free of charge, except the stamp duty. The use of plain paper does away with an important safeguard against the operations of a systematic forger, as he can only obtain the printed forms by theft or forgery. It is we believe correct now to say that all bankers issue blank-printed cheques to their customers, the last dissentients, the old established firm of Child & Co. having adopted the system some years ago.

The place where a cheque is drawn should be truly stated, although this is not absolutely requisite, since the later changes in the stamp Acts impose the uniform duty without reference to the place of issue. A cheque should bear the date of the day on which it is drawn; though if otherwise dated it would not be illegal. Postdated cheques, i. e. cheques bearing a date subsequent to the actual drawing used to be illegal. The drawer, payee, and the banker who knowingly paid such a cheque, incurred penalties, the drawer and banker of £100 each, and the payee of £20. The reason for this was that the use of post-dated cheques in lieu of bills of exchange occasioned a loss of stamp duty to the revenue. On this ground it is difficult to see why by the last stamp Act (33 & 34 Vict., cap. 99), post-dated cheques were legalised, except on the supposition that the practice was not likely to become general. Of course a banker inadvertently paying a post-dated cheque before maturity would have no right to charge his customer with the amount until it became due.

All cheques, with the exceptions mentioned below, are now subject to a duty of one penny, which may be denoted either by an impressed or adhesive stamp for which the drawer is liable. If, however, a cheque be issued unstamped, the payee or holder may supply the omission, and render the document valid, but the drawer will not thereby be relieved from the penalty incurred.

So again the person affixing an adhesive stamp is bound by law to cancel it by writing his name, or initials, and the date across it, and will be liable to a fine for neglecting to do so, but any holder may legally cancel it.

Sufficient importance is not attached to the general direction as to the cancellation of adhesive stamps. The 24th sec. of the Stamp Act of 1870 says:

(1.) "An instrument the duty upon which, is required or permitted by law to be denoted by an adhesive stamp, is not to be deemed duly stamped with an adhesive stamp unless the person required by law to cancel such adhesive stamp cancels the same by writing on or across the stamp his name or initials, or the name or initials of his firm, together with the true date of his so writing, so that the stamp may be effectually cancelled and rendered incapable of being used for any other instrument, or unless it is otherwise proved that the stamp appearing on the instrument was affixed thereto at the proper time."

(2.) "Every person who, being required by law to cancel an adhesive stamp, wilfully neglects or refuses duly and effectually to do so in manner aforesaid, shall forfeit the sum of ten pounds."

Prior to 1853 all cheques were unstamped, and were illegal if dated, or negotiated more than fifteen miles from the bank on which they were drawn; in that year an Act (16 & 17 Vict., cap. 59) was passed by which such cheques were legalised provided they bore either an impressed or adhesive penny stamp. The drawers were allowed the privilege of making these cheques payable to "order" instead of to "bearer," the effect of which will be mentioned below. This Act was constantly evaded by dating the cheque from the town on which it was drawn; it led, moreover, to endless disputes as to distance, and finally was a failure as a source of revenue. An Act (21 & 22 Vict., cap. 20) which came into operation in 1858, obliged all cheques drawn by private individuals to bear the penny stamp, with the exception of those payable to "self," and drawn at the bank counter, or paid to an authorised person for the use of the drawer. This exception has since been abolished, and at present the only cheques which may be legally paid without a stamp are those of some of the Government offices, poor law unions, and charities. The transfers passing between bankers are likewise exempted. Cheques drawn, indorsed, or negotiated out of the United Kingdom were formerly considered by law as foreign bills, requiring ad valorem foreign stamps. The Channel Islands and the Isle of Man were included in the word foreign.