Page:Halsbury Laws of England v1 1907.pdf/848

 — Bankers

626 Sect. 13.

Letters of Credit and

Documentary Bills.

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tendered him before or on presentment for payment (t^). Such acceptance is, however, a qualified one (e), and a banker would only be warranted in so accepting where he was fully empowered to do so by the letter of credit. Unless strictly stipulated in the acceptance, the acceptor is not discharged by the documents not being tendered to him before or on the due date of the bill(/), though payment cannot be demanded without such tender. Sect. 14.

Circular notes.

Banking.

Circular Notes.

1264. Where circular notes (g), accompanied by a letter of indicaby a bank to a customer or other person, it is not incumbent on that person to cash all or any of such notes. He may return them or any of them unused to the banker provided he at the same time returns the letter of indication, and may claim to be reimbursed or credited the amount of the unused notes (Ji). But tion, are issued

the return of the letter of indication alone, without the notes, will not entitle the customer or other person who took them out to any return of the money unless a satisfactory indemnity be given to the bank [i). The conditions or terms on which circular notes are issued constitute a contract between the bank and the person receiving the notes, though he may not be a regular customer, and breach of such conditions or terms may preclude him from claiming return of any of the money from the bank, where he might otherwise have

done so Xietter of

indication.

(k).

1265. The production of the letter of indication to the correspondent bank is not in ordinary cases a condition precedent to payment of the circular note, or to the right of the correspondent The acceptor thus (d) Ex parte Brett, Re Howe (1871), 6 Gh. App. 838, 841. gets security on the goods for his acceptance, while the bill is more readily negotiated by being accompanied by the documents, and the holder has security in case of dishonour. (e) Smith V. Vertue (1860), 30 L. J. (c. P.) 56. (/) Ihid. {g) For form of circular notes and notices of circular notes, see Encyclopsedia of Forms, Vol. II., pp. 474—476. {h) Gonfians Quarry Go. v. Parher (1867), L. R. 3 C. P. 1. In that case the name inserted in the (i) Gonfians Quarry Go. v. Parker, supra. circular notes as the person to present was that of a third party, but it is submitted that this can make no difference. The party taking out the notes might equally present them, if fraudulent. {k) Rhodes Y. London and Gounty Bank (1880), Journal of Institute of Bankers, Vol. I., 779, where the circular notes were payable to order of " the bearer p.

named

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in the letter of indication." notice was printed on the letter as to the necessity of keeping letter and notes apart, but the plaintiff did not do so, and lost the letter and notes by theft or accident. The notes were cashed by a person who forged the plaintiff's name, and it was held by Pollock, B., that the condition of keeping letter and notes separate was a reasonable one, and a material part of the contract, and that, the breach of it having led to the loss, the plaintiff >could not recover. The plaintiff was not a customer, but had deposited the amount of the notes. See also Hume-Dick v. Herries, Farquhar Go. (1888), 4 T. L. R. 541, which, on a similar condition and similar facts. Pollock, B., held inot distinguishable from Rhodes v. London and Gounty Bank, supra, and gave judgment for defendants.