BANKER'S OPINION. When a banker gives an opinion, in answer to a confidential inquiry, regarding the financial position of a customer, he should exercise the greatest care, for if he says too little he may injure his customer in the mind of the person on whose behalf the inquiry is made, and if he says too much he may mislead the inquirer.
A mere verbal opinion does not render a banker liable to an action for damages. In order to create liability for a wilfully inaccurate or misleading opinion, the repre sentation must be in writing and be signed by the person making it, and it is the actual person who signs it who is liable. If a bank manager gives a false opinion in writing, he is personally responsible and not the banking company of which he is an official.
Where a bank manager had given a banker's opinion and an action was brought for damages for misrepresentation (Parsons v. Barclay &' Co. and another, 1910, 103 L.T. 196), Mr. Justice Ridley, in addressing the jury, said : " I have to tell you that it will not do for you to find it was an inaccurate description of the state of things with regard to Messrs. G., it must be inaccurate to the knowledge of the person who made it. Though with some qualification that would be a true statement, I think I will just give the definition which is usually accepted as the one which is to guide a jury in such cases. ' In order that the statement should be fraudulent,' which is necessary to prove in this case if the plaintiff is to recover, it must be made knowing it not to be true, or without belief that it is true, or it must have been made recklessly or care lessly as to whether it was true or false.' " Judgment was given for the plaintiff. The defendant appealed, and the Court of Appeal reversed the judgment. The Master of the Rolls said : " He wished emphatically to repudiate the suggestion that, when a banker was asked for a reference of this kind, it was any part of his duty to make inquiries outside as to the solvency or otherwise of the person asked about, or to do anything more than answer the question put to him honestly from what he knew from the books and accounts before him.
To hold otherwise would be a very dangerous thing to do, and would put an end to a very wholesome and useful practice and long established custom which was now largely followed by bankers." Lord Justice Farwell said : " I thought everyone knew that these inquiries between bankers were well under stood, were familiar, and that nobody sup posed that one bank could ask another to go and hunt about and make inquiries. If inquiries are to be made, let the inquiring bank make them. What he asks from the bank from whom he makes the inquiry is, knowledge to be found in their books as to the state of the man or the account about whom he is inquiring ; and it is done, not from any question of duty or any considera tion, except that mutual courtesy and hope of a quid pro quo, to which Lord Bramwell refers." By Section 6 of 9 Geo. IV c. 14 (called Lord Tenterden's Act) : " No action shall be brought whereby to charge any person upon or by reason of any representation or assurance made or given concerning or relating to the character, con duct, credit, ability, trade or dealings of any other person, to the intent or purpose that such other person may obtain credit, money, or goods upon, unless such representation or assurance be made in writing, signed by the party to be charged therewith." As bankers' opinions are usually given with care and caution, it follows that the bankers to whom they are addressed should accept them in a similar spirit of caution.
Details of a customer's account should not, of course, be communicated to any one unless by the request of the customer.