The same considerations arise when a banker receives an unaccepted bill from a

The same considerations arise when a banker receives

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The same considerations arise when a banker receives an unaccepted bill from a customer forpresentation. As his customer‟s agent the bank must make early presentation. If he fails topresent the bill within a reasonable time and loss ensures to the customer, the bank will be heldresponsible. As a rule when a banker receives an unaccepted bill for presentation, he mustpresent it on the day of receipt.When a bill is presented to a drawee for acceptance he is entitled to possession of the bill and hemay retain it for 24 hours. Should the drawee refuse to return the bill, accepted or unacceptedafter 24 hours or destroy it, he can be sued for damages.Where a bill has to be presented in a place that is not the bank‟s area of business the bank canpresent it through its agent or if there is no bank near, the bill may be sent by post to the drawee.Where circumstances do not allow a bank to present a bill, the bank should advise the customeror the correspondent of these circumstances.Where the bank chooses to use an agent or a correspondent, the bank will be held responsible forthe acts of the agent or the correspondent. It will also be liable for any loss sustained by thecustomer though the negligence of the agent or the correspondent.Limitationsofthebanksactions:A banker should not take a qualified acceptance without the consent of the principal. where suchacceptance is given by a drawee, the bank should communicate with the drawer and seek furtherinstructions.A banker should not take the drawee‟s cheque and surrender the bill because this wouldrelease the drawer and endorsers of the bill. If the cheque is then dishonored, the drawee and theendorsers of the bill not being party to the cheque cannot be held liable on the cheque. Beforetaking the cheque the banker must obtain the principal‟s consent and where the cheque istaken, the bill must not be released before the bill is paid. It should be noted however by
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accepting a cheque the bank secures an instrument to which the drawee is liable whereas if hehas not accepted the bill, the drawee is not liable to the drawer of the bill.Where the place of payment was not indicated on the bill, the bank cannot insist that the draweeshould make payment in the town of the banks operations. The addition of a place of payment toa bill would be material alteration and therefore the bank cannot add any without theaccepter‟s consent.TheLimitationsplacedontheaccepterofthebillThe only person competent to accept a bill is the drawee or his authorized agent. Where a bill isdrawn by one party and accepted by another party, the third party is not liable on the bill as theaccepter.If the bill is addressed to a partnership any of the partners can accept the bill in thepartnership‟s name and bind all the other partners. Where the partner is a non trading one,only the party accepting the bill will be personally liable unless other partners have authorizedhim to accept bills on their behalf.
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