BANKER AND CUSTOMER

Evening Star, Issue 19274, 12 June 1926, Page 9

BANKER AND CUSTOMER

HEIR RELATIONSHIP Prominent in tho courts recently was tho case of the man who unsuccessfully sued iiis bank lor £-1,1100, writes “ A Hunker,” hi the * Daily Aluil. This sum was said t.o have been lost by him owing to making au investment on the .strength of information given by the bank. Banks are, of course, consulted by their customers on a variety of subjects, and render for them many services, but it will be seen that they run risks. A mistake made in doing some well-meant kindness might easily result in a law suit. .(for instance, a banker is under no obligation to give advice to Jus customers on investments, but if he does so negligently ho is liable for dam ages snoukl any loss result. Jewels, plate, and other articles of value are left by customers at their banks for sale custody in tho strung rooms. 11 thoso wen; lost awing to the hanker’ i carelessness, the banker would nave to make good the loss. lie himself, however, iia.s no claim on these goods. A customer might deposit for safo keeping a diamond worth £I,OUU, and later mu up an overdraft of £I,OOO. 'Die customer could, however, lake Ills jewel away whenever he wished, and the banker would have no right to regard it as a set-olf against tho overdraft. if a banker pays a forged cheque he must in the ordinary way bear the loss himself. Should the customer, however, fail to notify him immediately the forgery is discovered, and thereby lessen the chance of discovering the criminal and recovering tho money, the bank is free and the customer suii’ers. la the same way if a banker pays a cheque on which the amount lias been fraudulently raised he can debit, his customer with the correct amount ■only. If, however, the cheque was drawn negligently, possibly with blank spaces, almost inviting the insertion oi additional figures, the whole loss falls on the customer. When a customer’s cheque is dishonored in error by a banker heavy damages can sometimes bo obtained. It must be proved that actual damage to credit has been caused. If the customer were a trader ho would be almost sure to win his ease. If, however, he were a non-trading.person—-such as a clergyman or- a retired- Army officer —he would probably -get nominal damages only. There .is a widespread notion that a bank will never admit a mistake. It is certainly true that cashiers are remarkably accurate and seldom make mistakes, but when they do they ire always glad to rectify them. In cases where a cashier underpays anyone, it would, of course, bo gross dishonesty to refuse.