The Sun.
London, England, 1858-06-21 00:00:00

Kingdom :--
"The practice of crossing cheques originated
wiW the clerks at the London clearing-house, who
wrote the name of their bank across the cheques
they collected or cleared, in order to their ideutiti-
cation in case' they should not be paid. The cus-
tomers of the several bankers who were members
of the clearing-house soon learned that any cheques
drawn- by them and paid into a clearing banker's
hands t need not be provided for until the close of
the day ; it thus became the practice of the drawers
themselves to cross their cheques to ensure their
passing throtigh a banker.. This was further found
to be a great protection-against the improper ael-
propria ion of cheques so crossed; as 'the holder
could only obtain payment through the medium of
a banker through whom the- payment c -mid be
traced. in process of time this practice became a
custom recognised in the courts, and thus obtained
the force of law.
- „
" In a well-known 'case, that of 4 Bellaniy v. Mar-
joribauks,' in which it was sought to recover from
Coutta and Co. the amount of a cheque drawn upon
them and paid to Gosling and Co., although specially
crossed to the Bank of England, Baron Parke, in
giving judgment for the defendant, said, c We see
no legal objection to this custom, that of requiring
a Crossed cheque to be paid only to or through some
banker, if thus limited and underitood, 'lt is, ie
our opinion a reasonable and lawful practice and
usage, in er4.
er to secure as far as possible payment
of cheques to honest and bona fide holders. We
feel strongly that to carry it further, and make the
banker answerable to his customers for the appro-
priation by the payee of the proceeds of a crossed
cheque received through a banker, would render
the conduct of banking busiuess very difficult, if
not impracticable, and would cast a serious and
probably mischievous impediment in the way of
carrying on'the money transactions of 'his country.'
Although the custom well known and invariably
acted upon by bankers is clearleerecognised by
the courts, the public do not appear to have been
satisfied to bear their share of responsibility or th•
I.,Si arising from dishon sty of servants in appro-
priating crossed cheques entrusted to their care, for
in the case of Carlon v. Ireland,' where the plain-
tiff, a solicitor, had given a cheque specially'
crossed to his clerk, to pay lute his banker's, and
this clerk obtained the money from a tradesman to
whom 'he was known, and who paid the cheque into
the hands of his own.bankers, by whom the amount
was collected, the plaintiff sought to recover from
the tradesman, or in other words to mike another
bear the loss arising from the default of the plain-
tiff's servant. This attempt was nnsucces,ful.
Matters remained in this state pntil the passing of
an act introduced by Mr. Apsley, Pellatt, 19th and
20th Vide cap. 25, June 23, 1856, which enacted
that—
" In every case when a draft, on any banker
made payable to bearer or to order on demand,
bean across its face an addition in written or
stamped letters or the name of any banker, or of
the words " and Company," in full or abbreviaeed,
either of such additions shall have the force of a
direction to the bankers upon whom such draft is
made, that the same is to be paid to or through
some hankers' and the same shall be payable only
to or through some banker.'
" This act is clear and explicit ; but a case has
recently arisen, known as Simmons v. Taylor,' the
facts of which are briefly as follow : Simmons drew
a cheque eu the London Joint-stock Bank, and
crossed it with two transverse lines, and the words
'and Cfo. ;' the cheque fell into dishonest. hands,
the lines and words c &Co.' were carefully re-
moved, and in that the cheque was presented and
paid. It was sought to make tl'e banker liable for
having so paid the cheque which had been crossed,
although no vestige of such crossing appeared upon
it. This attempt was unsuccessful, and has resulted
in the- introduction of the present bill against
which I submit the following objec ions :
"1. That the banker has at present oast upon
him bylaw a vet y heavy responsibility; under which
no ordinary vigilance or care -will.guartl from
frequent losses. There are—let. Forgery, of en-
dorsements on bills of exchange.—ln these cases
the signatures of the endorsers cannot-possibly, in
ore instance out of a thousand, be known to the
banker. A few years since a Lindon banker was
compelled to lose several thousand pounds in con-
sequence of having paid a bill accepted by an insu-
rance company, the forged endorsements actually
existing on the bill at the tim'r it was accepted by
the company, whose agent was the defrauder. 2d.
Forged cheques and acceptances.—The recent con-
viction of a gang of forgers who had successfully for
many years carried on their practices, revealed that
these men had organised a scheule of a most per-
fect character, and were able to reproduce signa-
tures so perfect in their imitation of the originals
that it became impossible to detect the fraud until
after it had been successfully perpe'rat ed.
" In a case in which this bank was defraudel by
a series of forged cheques uttered by the clerk of a
customer, the execution of the forgeries was so
good that the customer himself did not, on the first
examination of his paid cheques, detect them all.
"2. The proposed bill, is unjust, as it will not
only relieve, Ist, the customer of the bank from
his fair share ofresponsibility and tick of losearising
from the dishonesty of his own, or the public ser-
vants of the Post-office service, but, _2(l, will also
relieve from the like responsibility and risks persons
with whom the banker, as drawee of a cheque, has
no connection • it is far from being an improbable
occurrence that a cheque should be issued un-
crossed, be crossed with and Co.' by a subsequent
holdei, and after passing through several hands be
the subject-of a collusive fraud on. the banker.
" 3. It will tend to geuerate on the part of the
holders of crossed cheques a want of care and cau-
tion in guarding these documents. The following
circumstance occurring recently with one of our
customers, confirms this conviction :—This house
is iu the habit of sending through the post cheques
payable to order,'• and iu the mistaken belief that
the bank was liable for the forgery of endorse-
ments on these documents, admitted that they had
no trouble, by requiring an acknowledgment or
otherwise of ascertaining that their 'remittances
had reached the persons for whom they were origin-
ally intented ; a draft was lost, and on calling at
the bank to stop the payment of it, they were in-
cidentally informed that the bank was not liable
on the payment of a draft to ' order,' purporting to
be indorsed by the payee, should such indorsement
prove to be forged, upon which, in alarm, they imme-
diately stopped the payment of several drafts they
had issued payable to 'order,_ but of which they
had received no acknowledgment.
"4. The examination of the crossing on cheques
at the clearing-house will be very difficult and fre-
quently quite impracticable. The greatest delivery
of cheques for payment through the clearing-house
takes place between half-past three and four
o'clock, and after the latter hour no more are re-
ceived ; three- quarters of an hour on ordinary days
and one hour on stock settling days are allowed for
the banker to examine signatures and accounts,
and make his entries before payment or return of
from 2000 to 3000 cheques on a settling day, and a
such in
tc hoe
eqcuuersr
eans
c are
ef
()urn poani de ,
ba na
ndkiet
ns—an
examination of the crossings,entry
essible.
which ri st
moat
ouhtsatavne
proportionateetuomilpfaraeye-
owritother
tinh e
rtheex a clearinghouse,
n
nua tmi
obne ri
so m
an odraedn, i
dnb
ea
bar
oye
mfooercsec
nibpoy
im
within the allotted term.
"We do not complain of those risks incident to a
business in which large sums of money are con-
stantly entrusted to the control of numerous clerks,
in whose integrity and carefulness great confidence
must necessarily be reposed, but we do copaplain
that an attempt should be made to relieve' mer-
chants and traders from the necessity of exercising
even ordinary vigilance in guarding their cheques,
and to throw upon the bankers any lois that may
result from frauds against which they cannot pro-
tect themselves, and which may in many cases be
prevented by the holder of a draftiusing that care
which on every ground of equity and fairuess he is
bound to do.
" On these grounds I venture to express the
hope that this bill will not be allowed to p.m into
law, and respectfully submit that the law as it at
present stands affords every legitimate protection
to the holders of-drafts.
" Wm. Melizweer, General Manager.,
" London and County Bank, 21, Lombard-
street, June 18, 1858."
•

CRYSTAL PALAU. --- Half-a-Crown Day.—Saturday,
June 19.—Admieeions on payment, 2,437 ; ditto Ly Beg.
son tickets, 1,741; total visitor?, 4,184.