No, forgery goes beyond representing on a cheque the signature of another and passing same as his without his consent. A cheque will be held to be fraudulent where the amounts in words or figures are altered to reflect something different without proper and valid consent of the Issuer first sought and obtained. See London Joint Stock Bank V. Mac-Millian & Arthur (1918) AC 777.
Where you were aware that there has been an illegal withdrawal from your account as a result of the forgery of your signature and you do nothing, then your silence becomes a representation and the bank will not be liable for the amount withdrawn. Brown V. Westminster Bank Ltd. (1964) 2LIR 187
Where the customer of a bank alleges that there has been an illegal withdrawal from his account by forged cheque and the bank contends otherwise, the burden is on the customer to prove his contention. If he fails, the bank will not be liable. Olutunji V. Cooperative Bank of Western Nigeria (1979) 12 CA 335
Yes, however if the account is in credit, the bank must give reasonable notice to the customer. BCCI V. D Stephenson IND. Ltd. (1992) 3 NWLR (232) 772
No, the act of ‘A’ acting as an agent of ‘B’ only makes his signature an unauthorized signature because he acted in excess of the authority granted him by ‘B’. It does not amount to forgery on the face of it alone as same can be ratified by ‘B’. Section 24 Bills of Exchange Act, Cap B8 LFN 2004
Firstly, a forged signature on a cheque makes the cheque void from the beginning and it cannot be corrected even by the original owner. However, an authorize signature that is not a forged one can be ratified by the original owner on whose behalf an agent purport to act even though he was not bound previously. Section 24 Bills of Exchange Act, Cap B8 LFN 2004
The bank has a duty to exercise reasonable care in the operation of your account with them. Where unauthorized third parties forged your signature and proceed to withdraw money from your account, the bank is liable to bear the sum withdrawn. However, you must not have consented to the forgery and illegal withdrawal, either expressly or by implication. Greenwood v. Martins Bank Ltd. (1932) 1 KB 371; Adama V. Bank of the North (1981-82) BNLR 72
The test of negligence of a bank is usually whether the bank acted in good faith and took reasonable care in reference to the interest of the true owner and whether the transaction of paying in any given cheque was so out of the ordinary course that it ought to have raised doubt in the mind of the banker which would cause him to investigate the authenticity of the cheque.
Morrison V. Condon County &Westminster Bank (1914) 3 KB 356; LLOYDS Bank V. Chartered Bank of India, Austria& China (1929) 1 KB (59); Nigeria Breweries Ltd. V. Muslim Bank of West Africa (1963) LLR 78 at 80; Adama V. Bank of The North (1981-82) BNLR 72
Yes, where a customer draws up a cheque or writes a cheque in a manner that would facilitate fraud, such customer is said to have breach his duty of care to the bank. When writing a cheque, a customer is expected to take usual and reasonable precaution to prevent forgery. London Joint Stock Bank V. MacMillan and Arthur (1981) AC 777.
The bank will not be liable for negligence where the forged signature is similar to your own, so that no difference can be reasonably inferred when the forged signature on the cheque is cross checked with your own signature. The burden is on you to prove that the signature on the cheque is either forged or unauthorized. Olatunji V. Co-operative Bank of Western Nig. Ltd. (1979) 12 CA 335
A customer would be prevented from contending that there has been an illegal withdrawal from his account as a result of the forgery of his signature if having discovered this has happened nevertheless refused to inform the bank that he has discovered that his signature is being forged on cheques. If he fails in this duty of informing the bank of such previous acts that he was aware of, it represents in effect that later signature even though forged are genuine, and he cannot say that his bank should not have made payment on the basis of the forged signature. Greenwood V. Martins Bank (1933) AC 51.
Where a person alleged to have paid another buy a bearer cheque for a contract agreement and such other person denies, it is not enough to produce the bearer cheque as conclusive evidence of payment. A bearer’s cheque for it to be proof of payment must be properly endorsed. It must contain the name and signature of the creditor. Agbafe V. Viewpoint Nig. Ltd. (1977) NWLR 113.
No, mere withdrawal of all money from the account of customer does not mean that the account has been closed. BCCI V. D` Stephenson IND. Ltd. (1992) 3 NWLR (232) 772
No, the bank is bound to honour the request of the customer who gives the instruction that his account be closed. BCCI V. D` Stephenson IND. Ltd. (1992) 3 NWLR (232) 772
A customer can instruct his bank to close his account by either writing a letter to his bank or by indicating it on the withdrawal cheque. BCCI V. D` Stephenson IND. Ltd. (1992) 3 NWLR (232) 772.
If the forgery and withdrawal was done without the notice of the directors and the company, then the bank will be liable as a result of its negligence for failing to observe the standard expected of a reasonable bank in respect of a cheque. Kepitigalla Rubber Estate Ltd. V. National Bank of India (1909) 2 KB; Nigerian Advertising Service Ltd. UBA (1965) NCLR 6
A signature on a cheque will be held to be forgery where it is made without the consent or the authority of the person whose signature it purports to be. See Section 24 Bills of Exchange Act Cap B8 LFN 2004
The effect of an unauthorized or forged signature in a cheque makes the cheque or any bill of payment wholly inoperative. Section 24 Bills of Exchange Act, Cap B8 LFN 2004; Nigerian Advertising Services Ltd. V. UBA (1965) NCLR 6; Greenwood v. Martins Bank Ltd. (1932) 1 KB 371
No, mere silence of the customer cannot amount to a representation, except where the silence is so deliberate not withstanding a duty to disclose, then such deliberate silence may become significant and amount to a representation. Greenwood v. Martins Bank Ltd. (1932) AC (at P.57)
No, once the customer’s contention succeeds, the burden is then shifted to the bank to prove why it should not be liable. The bank may prove that while the contention of this customer may be true, the customer’s act or his refusal to act, aided the illegal withdrawal. That is the customer knew of the fraudulent act and did nothing abut it. Greenwood v. Martins Bank Ltd. (1932) 1KB 371; Brown V. Westminster Bank Ltd. (1964) 2LIR 187
No, once the customer’s contention succeeds, the burden is then shifted to the bank to prove why it should not be liable. The bank may prove that while the contention of this customer may be true, the customer’s act or his refusal to act, aided the illegal withdrawal. That is the customer knew of the fraudulent act and did nothing abut it. Greenwood v. Martins Bank Ltd. (1932) 1KB 371; Brown V. Westminster Bank Ltd. (1964) 2LIR 187
Yes, the bank is right to not abide by your oral countermand order. A countermand order must not only be in writing, but it must be signed by you. Curtice V. London City & Midland Bank (1908) 1 KB 293.
Yes, the bank is right to not abide by your oral countermand order. A countermand order must not only be in writing, but it must be signed by you. Curtice V. London City & Midland Bank (1908) 1 KB 293.
a) You must give an actual notice to your bank and the bank must have knowledge of it.
b) The notice must be in writing and must be signed.
c) The notice must be sent to the branch where you have your account.
d) The notice must be clear and specific.
e) There must be reasonable time within which the notice was issue and the cheque was presented. Curtice V. London City & Midland Bank (1908) 1 KB 29; Westminster Bank V. Hulton (1926) TLR 124 London Provincial & South Western Bank V. Buszard (1918) 35 TLR 142.
a) You must give an actual notice to your bank and the bank must have knowledge of it.
b) The notice must be in writing and must be signed.
c) The notice must be sent to the branch where you have your account.
d) The notice must be clear and specific.
e) There must be reasonable time within which the notice was issue and the cheque was presented. Curtice V. London City & Midland Bank (1908) 1 KB 29; Westminster Bank V. Hulton (1926) TLR 124 London Provincial & South Western Bank V. Buszard (1918) 35 TLR 142.
No, mere delay of payment of money by the bank does not in itself constitute wrongful dishonour of charge. Ejimofor V. Union Bank of Nig. (1981) 1 FNR 5
No, a bank cannot ignore a countermand order and proceed to make payment to third party who is in possession of the cheque issue by the bank’s customer before the countermand notice. The bank will be liable to the sum paid to the third party where it ignores the countermand notice. Nwandu V. Barclays Bank Co. (1962) ANLR 1147.
A bank has the right to recover the payment it made to the payee who brought the countermanded cheque where such payment was made under a mistake of facts. However, the bank’s claim will fail in the following instances:
a) If the payer (customer) had intended that the payee (third party) should have the money at all event either in fact (notwithstanding if it is true or false) or in law.
b) Where the payment had been made in good consideration. For instance, for the settlement of debt.
c) Where the payee (third party) has changed his position in good faith or was deemed in law to have done so. Barclays Bank V. WJ SIMMS-SON & COOKE (Southern) Ltd. (1979) 3 All ER 522
No, a bank cannot refuse to honour the cheque you produce to withdraw money from your account for no reason or even for reason which would be considered wrongful for dishonouring of your cheque. Enyi V. African Cont. Bank (1981) 1 NSLR 352
Yes, the bank can refuse to honour a cheque on the ground of irregular signature. Babalola V. Union of Nig. (1980) NCLR 20.
No, it will not be valid, and the bank can ignore such notice. A countermand notice must be clear, specific and unambiguous because commercial actualities thrive on certainty. Westminiter Bank V. Huton (1926) TLR 124
Where a bank refuse to honour a cheque on the basis of insufficient fund in the account of customer, the bank has the burden to prove that indeed the customer had no sufficient fund in his account at the time the cheque was presented. The bank will be liable for wrongful dishonour of cheque where it cannot ground same. Ashubiojo V. African Cont. Bank (1966) NCLR 78.
Countermand is a situation in which a customer of a bank having issued authority to a bank to pay certain sum to a third party, proceeds to withdraw or cancel such authority so as to revoke payment to the third party. A bank’s duty to pay is terminated by countermand of payment by the customer. Curtice V. London City &Mudiand Bank (1908) 1 KN 293.
No, a bank cannot ignore a countermand order and proceed to make payment to third party who is in possession of the cheque issue by the bank’s customer before the countermand notice. The bank will be liable to the sum paid to the third party where it ignores the countermand notice. Nwandu V. Barclays Bank Co. (1962) ANLR 1147.
No, a notice of countermand must come from the customer and not a third party. Ademiluyi V. African Cont. Bank (1964) NCLR 10