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Explain the duties of a banker to a customer in relation to the negotiable instrument.

Explain the duties of a banker to a customer in relation to the negotiable instrument

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1. Duty of Care: The banker is bound to exercise reasonable care and skill in his dealings
with the customer. The standard of care and skill is that of a reasonably competent banker.
If the banker fails to exercise such care and skill, the customer has an action in damages
for any loss arising for professional negligence.
2. Professional Advice: The banker is bound to give the customer professional advice on
request. He is bound to give advice on investments as and when requested failing which he
is liable in damages.
3. Duty to Honour Cheques: The banker is bound to honour all cheques drawn by the
customers provided: -
a. The cheque is complete and regular on the face of it
b. The customer?s account has sufficient funds
c. The cheque is presented at a reasonable hour on a business hour and business day.
d. The payee identifies himself to he satisfaction of the banker.
e. If a banker fails to honour a cheque in breach of this duty, the customer has an
action in damages.
4. Duty of Secrecy: The banker is bound to maintain confidentially in his dealings with
customer. He must not discuss to 3rd parties any information which comes to him in the
course of his dealings with the customer. The duty of secrecy was laid down in Tournier v.
National Provincial and Union Bank of England which the English Court of Appeal
insisted of the upholding of the duty. However the court was emphatic that the duty may
be qualified in certain circumstance where personal information relating to the customer
may be discharged to 3rd parties e.g.
a. Where disclosure is provided for by the law
b. Where the banker has the customer convent to disclose
c. Where disclosure is necessary in the public interest
d. What it is necessary to protect the banker

sharon kalunda answered the question on April 12, 2019 at 14:02

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Explain the duties of a banker to a customer in relation to the negotiable instrument.

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