The plaintiff had a cheque account at the Borough Branch and drew a cheque on the cheque forms which had been provided. He crossed out the word `Borough’ and put in `Bromley’. He altered the address and he initialled the cheque. Later he decided to stop payment on the cheque, telephoning the Bromley Branch and informing them of this decision. The cheque had passed through the computer system which could not read the alterations made by the plaintiff. The cheque itself was forwarded to the Borough Branch at which the employees were unaware of the stop-payment instructions. At the end of the suspense period, the amount of the cheque was debited to the plaintiff’s account at the Borough Branch.
Held: The bank was unsuccessful in its contention that a new practice utilising the introduction of magnetic ink characters seeking to restrict cheques to the particular account for which they had been prepared, had been consensually agreed to by the customer. Notice of a change in condition oin cheque book covers was ineffective. A stop instruction from a bank’s customer applies to all accounts at the same branch if a specific account is not specified.
The bank is the debtor of the customer, whether the customer has a current or deposit account.
Judges:
Mocatta J
Citations:
[1966] 1 QB 742, [1965] 3 All ER 81
Jurisdiction:
England and Wales
Banking, Contract
Updated: 09 December 2022; Ref: scu.448095