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J Jones

safe, bankers, custody, articles, customer, bonds, banker, customers, bank and receipt

J. JONES, Manager.

N.B.—This receipt should be kept in a place of safety. The security referred to therein can only be returned on the following receipt being signed by the Depositor and surrendered to the Bank. The personal application of the Depositor is particularly requested, but if he is unable to attend, the order on the back hereof should also be signed.

The receipt given is, in some banks, signed by the manager and the accountant. The customer depositing the articles for safe custody may be required to sign the counter foil bearing the same number as the receipt which he obtains. This not only gives the bank a specimen of the depositor's signature which can be compared with the customer's receipt when a withdrawal takes place, but it acts as a confirmation from the customer of the articles which he has left to be taken care of.

Some bankers, however, do not give any receipts for articles left with them for safe keeping, unless specially requested so to do. They merely keep particulars of them in the safe custody register, and when the customer receives the articles back again he signs an acknowledgment for them in the register. Some bankers, who give no acknowledgments, permit the customer to see the entry of the deposit in the safe custody register.

When articles have been deposited in joint names they should not be given up except on the authority of all the parties. If one of the depositors has died, the autho rity of his legal representatives is usually obtained before delivery to the survivor or survivors.

All the executors of a deceased should join in an authority to give up safe custody articles which were deposited in the name of the deceased.

Where articles are deposited in the names of executors, the signatures of all, or the survivors, should be required before delivery.

Where the lodgment is in the names of trustees, it is particularly necessary to obtain all their signatures before delivery. In Mendes v. Guedalla (1862, 2 J. H. 259), where a box containing bearer bonds was lodged for safe custody by three trustees and one of them held the key in order to cut off the coupons half-yearly, it was held that the bankers " ought not to have parted with the box, or allowed more than the coupons to be taken out, without the authority of all the three trustees." If a banker receives an authority from a depositor to allow another person to remove a certain article from a box or parcel, the banker must see that only the specified article is taken out.

In the case of In re De Pothonier, Dent v. De Pothonier (1900, 2 Ch. 529), the follow ing statement was given as to the practice in London with regard to the safe custody of bearer bonds :—" It is a common practice of investors to deposit such bonds with their bankers upon a simple acknowledgment by the bankers of the receipt thereof. In such cases the bankers accept the deposit subject to such responsibility as is imposed upon them by law for their safe custody, and they collect the coupons for their customers, and credit them to the account of the customers, as and when received. From my own know ledge of the course of business in the City, I say that it is a very common practice amongst men of business, and joint stock companies who hold large quantities of bonds, to deposit them with their bankers upon the above terms, and I believe that such practice offers to the owner of the bonds as good a security for the safe and proper custody of such bonds as can be obtained, and is at the same time the most convenient course the bond holder can adopt as regards the collection of interest on the bonds. If bonds to bearer are deposited

with bankers in a locked box or other closed receptacle, the bankers do not give any receipt for the bonds, but only a general acknowledgment of receipt of the box, and decline to accept any responsibility for its contents." In the same case it was held that the trustees were " justified in depositing the bonds with the bankers upon those terms, which will not justify the bankers in parting with the bonds except under the authority of all the trustees, but will justify the bankers in cutting off the coupons and col lecting them as and when they are due, in the ordinary course." In taking charge of valuables for a customer, a banker acts in the capacity of a bailee, and the responsibility of a banker with regard to articles left for safe custody depends in some measure as to whether he is a gratuitous bailee—that is, undertakes the work without any special charge for doing so—or whether he is a baileefor reward Bankers do not, as a rule, receive any direct reward,, and merely take charge of the articles to oblige customers, but it is con tended by some writers that the fact of a banker making a profit out of a customer's account shows that he is indirectly a bailee for reward. When a customer opens an account he knows, if he looks at the adver tisements of the bank, that he obtains, by becoming a customer, a right to leave his valuables at the bank to be taken care of ; the banker, on his side, agrees to act as a bailee for a customer's valuables because of the account which the customer keeps with him and from which he expects to derive some benefit.

The question as to whether a banker is a gratuitous bailee or not, does not affect the practical point that a banker must take all possible care of articles left with him for safe custody, for if he is negligent and they are stolen, or if he parts with them to a wrong person, he will be liable for the loss to his customer. A banker's liability for loss might probably be less if it were proved that he was a gratuitous bailee, and not a bailee for reward.

if a banker has doubt as to the genuine ness of a signature upon an order for delivery of a safe custody article, or any suspicion as to the authority of the person who pre sents the order, he is justified in making a delay in fulfilling the order until he has had the signature confirmed by the customer. In the case of ?elm's. Langtry v. The Union Bank of London (which was settled by judgment for the plaintiff by consent for £10,000), the plaintiff's property was obtained from the bank by a person presenting a forged order purporting to be signed by Mrs. Langtry, requesting the bank to hand her box to the bearer.

A banker has no lien or charge upon securities or articles left with him for safe custody. if a safe custody article is to be taken as a security at any time, the customer should sign the necessary document of charge.

The Bank of France makes a specific charge for taking care of securities and valuables for customers.

In America, bankers decline to take charge of articles for safe custody, but they have a system of letting lockers, in the safe deposit department, to customers, at a rent, thus throwing the responsibility and labour of cutting off coupons, etc., upon the customers