If the cheque is crossed with the name of a particular banker, it can only be paid to or through that banker.

Thus, the original bearer or holder of the cheque cannot obtain cash for it, except through his banker, or his friend's banker.

If the crossing be so erased by some dishonest person that the cheque may, without negligence, pass for an uncrossed one, the banker is justified in cashing the cheque if he does not notice the crossing, and the loss must be borne by the customer. The question of the banker's negligence is, of course, for a jury.

The word "banker" of course includes any banking

company.

The crossing of cheques is now to be deemed a material part of the instrument, and a dishonest erasure of such crossing is a felony.

This law applies to the whole of the United Kingdom. 10. When a cheque is dishonored, it is usual to return with "no effects" written on it.

A cheque, like a bill, must be presented within a reasonable time, which generally includes the day after it is issued (see sects. 3 and 15).

All that is meant by this is not that the drawer is always discharged, by failure to present within the time mentioned, but that if he be prejudiced by the delay (as if the banker fail), he will then be discharged. In fact, by keeping the cheque too long, the holder runs the risk of the bank failing.

The drawer is, in this sense, entitled to have the cheque presented within the time above mentioned, though the payee has given it to his banker for presentment, or circulated it through several hands.

When a cheque has been cancelled by mistake it is usual to write on it "cancelled by mistake," and this is considered to amount to a refusal to pay.

When a bill of exchange is cancelled by mistake it operates under certain circumstances very injuriously, especially in the case of foreign bills. For example, a bill drawn from Paris on a house in London was presented at a bankers in the city, and "cancelled by mistake." On the discovery of the mistake, which was almost immediately done, the words "cancelled by mistake" were written at the bottom of the bill, with the

initials of the clerk who cancelled it, and in addition the words "no effects.”

The protest not only gave a copy of the bill, but also the words "cancelled by mistake, no effects," and a fac-simile of the manner in which it was cancelled.

On the bill and protest arriving in Paris the house there refused to take it back, on the plea that the law of France is, that when a bill is cancelled-no matter under what circumstances-it ceases to possess any of the necessary attributes to enable a party to recover the amount from any drawer or indorser, but is treated as so much waste paper.

11. Bills of Exchange and promissory notes being frequently expressed to be payable at a bank, the following information may be useful here.

Where a bill is accepted thus: "Accepted, payable at Messrs. Coutts', in London, John Brown," the bill need not be presented at the bank in order to charge the acceptor, any more than if all mention of the bank had been omitted. But, in order to charge the drawer and indorsers, it must be presented at the place named.

But if the words used had been "Accepted, payable at Messrs. Coutts', in London, and there only, John Brown," the acceptance would be special, and the bill must be presented at the place named, even for the purpose of charging the acceptor.

A promissory note which is, in the body of it, expressed to be payable at a particular bank, must be presented there, even for the purpose of charging the maker himself. The contract is only to pay at that particular place.

But if the place of payment be merely mentioned in a memorandum on the bill, that is held to be only a direction, and not to qualify the contract.

(For further information as to the rights and liabilities arising on these instruments, see Walter Smith on 'Bills, Cheques, and Notes.')

12. There is a custom among the City bankers that when cheques are paid in too late for the clearing of the day, to send a clerk round to the several bankers on whom they are drawn to be marked. This marking of a cheque is held to be as binding on the banker as his acceptance of a bill would be; for it is an admission of assets rendering the banker liable to pay, and is the

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same as if the banker had written on the cheque “We will pay this to-morrow in the clearing."

13. To explain the meaning of the above answer, let us state what is meant by "the clearing."

It has been a long-established custom for the City Bankers to rent a house near the Post Office in Lombard Street, which is called the "Clearing House;" to this house the bankers daily send all bills of exchange, which may be due on that day, as well as all cheques which have been paid in since the clearing of the preceding day; every banker who attends the house, and who is usually styled a "Clearing Banker," is provided with a desk, on which his name is affixed.

The clerk who conducts the clearing business takes to the clearing-house the securities before referred to, after they have been charged against him, and deposits them with the several clearing clerks of the bankers on whom the cheques are drawn ; and in case of bills, with whom they are made payable.

At a particular time of the day (which is exactly 4 o'clock) the clearing-house doors are closed, so that after that hour there is no admittance, and consequently no more cheques or bills can be brought in. As a means of ascertaining by whom the cheques have been deposited by any particular banker, the name of the firm so depositing them is previously written across each cheque.

This was the origin of crossing cheques, and the prac tice has ever since been adopted by the parties who issue them, as security against fraudulent misappropriation. In the case of bills of exchange, they are receipted on the back with the name of the banker to whom they belong.

The clerk in attendance enters the several bills and cheques deposited with him, and credits the respective accounts of the several bankers whose names are written across the cheques or indorsed, as receipted on the back of the bills. He then sends them to his banking house by a clerk in waiting, for the purpose of ascertaining whether they are to be paid; if none of them are returned to him, he concludes they are all correct.

The same clerk having previously in like manner disposed of such bills and cheques on the other bankers as

his house held, and for which he debited the several bankers previous to depositing them in their separate drawers, he balances each banker's account, and submits the same to the general superintendent of the clearing-house (an official specially appointed by the body of bankers) for examination and approval; and this is done by all of them.

Of late years the manner of adjusting the balances has been altered. Hitherto it was the custom to pay bank notes for sums above fifty pounds, and when under that amount, it was carried to the next day's account.

Now, however, all the clearing bankers have accounts opened with the Bank of England, and those bankers that are debtors to the clearing (that is, when the claims on them exceed those they have on other bankers) fill up and sign an order on the bank, requesting that their account may be debited for the amount so due by them, and credited to "the general clearing-house settlement account."

The order is signed by an authorised person, and countersigned by the superintendent of the clearinghouse. In like manner those who are creditors in the clearing give an order similarly signed, requesting the bank to credit their account with the amount due to them in the clearing.

This arrangement is not only a great improvement, but a vast accommodation to all parties. It economises bank notes to the amount of many millions in the course of the year; is a check against any irregularity in that department; besides avoiding the risk attendant upon the carrying about large sums of money, particularly during the dark winter evenings.

In order to show to what extent the use of bank notes has been economised, through the operations in the clearing-house, it is only necessary to state that the amount of cheques and bills settled at the clearing-house during the year 1870 was £3,720,623,000, and all this was effected without the use or employment of a single bank-note or sovereign.

It is gratifying to perceive that by the mutual cooperation of the three great banking interests all prejudices entertained by the private bankers have been

removed, and that the Bank of England has also relinquished those stringent measures which they adopted on the first introduction of joint-stock banks.

14. Within the last few months the country bankers have agreed among themselves to adopt the advantages of the London clearing, as far as relates to the cheques issued and payable in the country. The manner of effecting this is that each country banker daily sends to its London banker the cheques on other local banks received by them from their customers, instead of forwarding them, as heretofore, separately to the various banks on whom they were drawn.

For example: bankers at Norwich receive twenty cheques drawn on twenty different country banks; these cheques are now remitted to Barclay's, who send them to the clearing-house, where they are deposited in the drawers of the various banks who transact the London agency business of the parties to whom the cheques are addressed.

Instead of Barclay's getting credit for them at once, as they would in the case of London cheques, they are forwarded by the London agent, by the same night's post, to the banker on whom they are drawn, and if found correct, the country bankers advise their London agent that they have credited their account with the same. The amount is accordingly allowed to Barclay's in the next day's clearing, who, in their turn, inform Gurney's, of Norwich, that they have credited them for the same.

Should any cheque so sent not be correct, it is forwarded without delay to the bankers whose name appears. across the cheque.

15. The following are the rules for the regulation of country clearing:

(1) A clearing to be held in the middle of each day for the interchange, among the London bankers, of cheques on their correspondents in the country, placed in their hands for collection.

(2) Each London banker to remit for collection to his country correspondent the cheques drawn upon them, saying "Please say if we may debit you £ cheques enclosed."

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