Commonwealth Consolidated Acts

BILLS OF EXCHANGE ACT 1909 - SECT 88D

  (1)   Where:

  (a)   a banker, in good faith and without negligence:

  (i)   receives payment for a customer of a cheque; or

  (ii)   having credited a customer's account with the amount of a cheque, receives payment of the cheque for himself or herself ; and

  (b)   the customer has no title, or has a defective title, to the cheque;

the banker does not incur any liability to the true owner of the cheque by reason only of having received payment of the cheque.

  (2)   Subject to the next succeeding subsection, a banker shall not be treated for the purposes of this section as having been negligent by reason only of his or her failure to concern himself or herself with the absence of, or irregularity in, indorsement of a cheque.

  (3)   The last preceding subsection does not apply in relation to a cheque unless the name appearing on the cheque as the name of the payee:

  (a)   is the same as the name of the customer; or

  (b)   is so similar to the name of the customer that it was reasonable, in all the circumstances, for the banker to assume that the customer was the person intended by the drawer to be the payee.

  (4)   This section applies in relation to a draft drawn by a banker upon himself or herself and payable on demand, whether the draft is payable at the head office or at some other office of the banker, as it applies in relation to a cheque.