In Scotland, the pass books, in some of the banks, are initialled on the payments-in side by both teller and ledger clerk, and in other banks by either the teller cr a clerk. The amount paid in is entered in the pass book in writing as well as in figures.
The entries made in a pass book by a bank may be used in evidence against the bank. Where an entry showing a payment to a customer's credit has been made in a pass book in error, and the customer, relying upon that credit, has drawn cheques against it or in some other way altered his position, the hanker will be bound by that entry. But if the customer's position has not been altered by the entry, the banker is at liberty to show that the entry was made by mistake.
An entry in a pass book in favour of a customer is prima facie evidence against the banker, and an entry against a customer is prima facie evidence against the customer after the pass book has been seen by the customer and returned to the bank without any comment being made.
In Commercial Bank of Scotland v. Rhind (1860, 3 INIacq. H.L.R. 643), Lord Campbell said : " Considering that the pass book (as its name indicates) is a book which passes between the bankers and their customer, being alternately iu the custody of each party, on proof of its having been in the custody of the customer, and returned by him to the bankers without objection being made to any of the entries by which the bankers are credited, I think such entries may be prinui facie evidence for the bankers as those on the other side are prima facie evidence against them." Where a mistake has been made the sooner it is rectified the better, as the length of time during which an erroneous entry remains in a pass book may be important. The longer a customer sees a certain amount standing to his credit, the more difficult it will be to prove that the customer has not altered his position on the strength of that credit. _\ banker is at liberty to show that a mistake has been made even if the entry in the pass book has been formally initialled by an official of the bank. But a banker is not, of course, excused from liability if he has received money for a customer and has omitted to give him credit for it.
When a customer obtains his pass book from the bank, keeps,it in his possession for a certain time and then returns it to the bank without any comment, the ordinary conclusion is that the customer has ex amined the book and found it to be correct ; but this view of the matter may not be the one which the Courts will take in such a case. For instance, in Chatterton v. London
and County Banking Co. (1S90, unreported), Lord Esher, M.R., expressed the opinion that a customer is not bound to examine his pass book. He said : " A hundred things may happen to prevent him from looking into it when he has got it, and what right has the bank to infer that he has looked into it." In Fagliano Brothers v. Bank of England (1889, 23 Q.B.D. 243), where the plaintiff had received his pass book half-yearly along with the paid cheques, which cheques he retained, and returned the pass book to the bank without any remark, Bowen, L. J., in his judgment said : " There is another point to be considered. The plaintiff from time to time received from the bank his pass book, with entries debiting the payments made, for which the bank sent the bills as vouchers, which were retained by the plaintiff when he returned, without objec tion, the pass book. It was contended that this was a settlement of account between him and the bank, and that he had been guilty of such negligence with respect to the examination of the vouchers as would have prevented him from being relieved from this settlement of account. But there was no evidence to show what, as between a cus tomer and his banker, is the implied contract as to the settlement of account by such a dealing with the pass book, or that, having regard to the ordinary course of dealing between a banker and his customers, the plaintiff had done anything which can be considered a neglect of his duty to the bank or negligence on his part." With reference to the expression " settle ment of account " in the above judgment, an account is considered to be a stated or settled account where the customer has given a definite confirmation of the correctness of the account, or where the account has been balanced and ruled off as is done in pass books at the end of each half-year. Some authorities consider that where a pass book is given out with the balance entered in the book in pencil it should be considered a settled account, but other authorities do not attach much importance to a pencilled bal ance and hold that it does not constitute a settled account.