405. Protection of banker
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(1) Where a banker, in good faith and without negligence—
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(a) receives payment from a customer of an instrument to which this section applies;
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(b) having credited a customer's account with the amount of such an instrument, receives payment for the instrument; or
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(c) receives payment for a customer of a cheques crossed generally or specially to the banker and the customer has not title, or a defective title, to the instrument,
the banker does not incur any liability to the true owner of the instrument by reason only of having received payment for it.
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(2) This section applies to the following instruments—
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(a) cheques including cheques which under section 404A or otherwise are not transferable;
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(b) any document issued by a customer of a banker, which though not a bill of exchange, is intended to enable a person to obtain payment from that banker of the sum mentioned in the document;
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(c) any document issued by a public officer which is intended to enable any person to obtain payment from the Accountant General of the sum mentioned in the document but is not a bill of exchange; or
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(d) any draft payable on demand drawn by a banker upon the banker, whether payable at the head office or some other office of the banker.
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(3) A banker is not to be treated for the purposes of this section as having been negligent by reason only of the failure of the banker to be concerned with—
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(a) the absence of an irregularity in the endorsement of an instrument; or
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(b) the purported endorsement of a cheque which is not transferable under section 404A or otherwise.
(4) A banker receives payment of a crossed cheque for a customer within the meaning of this section, notwithstanding that the banker credits the customer's account with the amount of the cheque before receiving payment for it.
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(Substituted by Act 14 of 2010)