A CHEQUE CASE.

Star (Christchurch), Issue 5871, 13 May 1897, Page 2

A CHEQUE CASE.

\ ■ — * — \ — WHO SHOULD BEAR THE LOSS ? AN IMPORTANT DECISION. [Prom Our Correspondent.] LONDON, March 26. Since, under existing circumstances, the final legal settlement of all business dis putes rests with her Majesty's Judicial Committee of the Privy Council, merchants throughout the Empire will be interested in a case tried by Mr Justice Grantham at Leeds on Saturday. His lordship's decision is, to put it mildly, astounding, and, in the interests of the mercantile community at lai'ge, it is to be hoped, the case will be carried to the highest tribunal. Briefly put, the facts are as follow : — Messrs John Crossley and Sons, Limited, posted to Mr J. W. Pennington a cheque for .£503, in payment for goods supplied. The cheque was stolen in transit, and misapplied. The question Mr Justice Grauthamwasi called upon to settle was, whether the sender or the intended receiver was liable for the loss thus incurred. The.judge'B decision was that the posting of the cheque was payment of the debt. According to the report in the Leeds Mercury, " the defendants had exonerated themselves from liability, by having paid this account by sending a cheque to the Post Office on Dec. 24, 1896." The cheque did not reach its payee, who was consequently made the victim of the theft. It is not very clear on what grounds the learned Judge arrived at tliis conclusion. He admitted the difficulty of the case as involving a hardship to one of two innocent parties, but appears to have ruled that these two parties had agreed that the payment should be made by cheque, and that proof of posting the cheque would, be proof of payment that must be held good in law. ANOTHER EXTRAORDINARY FEATURE of this case is that the thief opened an account at the Headingley branch of , the York City aud County bank by paying in this cheque, with presumably a forged endorsement, it passes comprehension how any banker could have opened an account in such an irregular fashion without any introduction or credentials, arid the Judge's strong remarks regarding this peculiar procedure are not surprising. He said he would be very sorry if he thought bankers usually acted in such, a manner, for, if it was the custom for banks to receive cheques, as in this ca3e, the value of crossing was destroyed. Surprising as the manner of opening the account was, it is still more astonishing to learn that the person who presented the cheque was allowed to draw out forthwith £200 in gold. It is an Open question whether such gross carelessness as was exhibited in this case by the banker, carries with it no pecuniary liability. In the interests of commerce it is to be hoped that it does, and Mr Justice Grantham threw out some plain hints that the matter was one which it would be desirable to try.