Banking law week 3

Duty of confidentiality

Tournier v national Provincial and Union Bank of England (1924)

Case facts-
Mr Tournier overdrew his bank balance by 10 pounds.
He owed 6
His pay was being spent on gambling
His employer became aware
And resultingly was not given a renewal of contract
Thus causing damages, therefore Tournier sued the bank

BUT

Exception in the case of:

-Terrorism, money laundering, tax evasion, drug trafficking, and fraud committed in the corporate
environment

Case law-
Barclays bank Plc. v Taylor [1989]
1-Bankers duty of confidentiality was qualified by the exception of disclosure under compulsion of the law
2- No implied obligation on the banks part to oppose the disclosure order
3- no implied obligation for the bank to inform their clients about the disclosure and or the order by compulsion of the law

Christofi v Barclays Bank PLC. [1998]

Mandate- the agreement and the terms within which the bank must act
e.g.
- when to pay cheques or other instruments drawn by the customer on their account
- The authority for a bank to act in a way

The banks duty to not exceed the customers mandate:

-Lipkin Gorman v Karpnale Ltd [1989]

-Lloyds bank LTD v Chartered bank of India, Australia and China [1929]
-Barclays Bank PLC v Quincecare LTD [1988]
-Phillips v Barclays bank UK PLC [2022]

The banks duty to make payment

If the customer has enough funds or had made an overdraft agreement with the bank, the bank is obliged to honour
cheques drawn by the customer and presented to the bank.

Wrongful dishonour of a payment instruction may amount to a breach of contract:

Fleming v Bank of New Zealand [1900]
Banks duty to obey the customer’s countermand

Countermand- An order revoking a previous one which, when given correctly, terminates the banks duty to
pay
- Countermand must be clear and unambiguous (given sufficient information)
- The bank must be able to reasonably satisfy itself that the countermand if that of its customer

Case law:

Curtice v London City and Midland Bank LTD [1908]

- The bank is not obliged to accept an unauthenticated message as a countermand of its duty and authority to pay
in accordance with its customer’s mandate.

The banks duty to render and account:

- Holland v Manchester and Liverpool