Banking law - do customers have a duty to check bank statements?

antrobus

billbennett wrote: »

I think Judge Judy would see it differently.

She might well do.

However, I'm not quite certain that the opinions of a former New York family court judge would neccessarily have any validity in deciding on a point of UK banking law.

JKSandy

lissa_23 wrote: »

I thought that too, but I've been looking at Barclays terms and conditions and it doesn't say it there. Maybe because they can't put in a clause that overrides banking law?

Not to be too rude, following on from yorkshireboy's post, you studied banking law and don't know how to check T&C's?

Hominu

Fran.Guester wrote: »

all banks now have online banking/mobile apps/better opening hours. to avoid something like this just use all the means available and check them regulary.

Or alternatively, don't do any of them and then moan on here 12 months after someone has setup a DD on your account and complain you don't have time to check your statements.

EarthBoy

antrobus wrote: »

As far as I'm aware.

Google says the leading cases are:-

Greenwood v Martins Bank (1933)
Tai Hing Cotton Mill Ltd v. Liu Chong Hing Bank Ltd (1986)

Of course, they were arguing about cheques in those days, but the same principle applies to other payment methods.

The judgement in the latter case held that a bank's contract with its customer could include a binding condition to check their statement. The bank lost the case because the judges held that the condition wasn't clear enough.

http://oxcheps.new.ox.ac.uk/new/casebook/cases/Cases%20Chapter%2010/Tai%20Hing%20Cotton%20Mill%20Ltd%20v%20Liu%20Chong%20Hing%20Bank%20Ltd.doc

"If banks wish to impose upon their customers an express obligation to examine their monthly statements and to make those statements, in the absence of query, unchallengeable by the customer after expiry of a time limit, the burden of the objection and of the sanction imposed must be brought home to the customer. In their Lordships' view the provisions which they have set out above do not meet this undoubtedly rigorous test."

lissa_23

JKSandy wrote: »

Not to be too rude, following on from yorkshireboy's post, you studied banking law and don't know how to check T&C's?

Thank you, but it is a bit rude to belittle someone on a public forum!

I studied banking law 20 years ago but I do still know how to read!

The part of the Barclays t&c's referred to above which says that you must check your statements is in the section relating to what Barclays will do when you give them instructions, saying you have to check they have carried out your instructions correctly, not in the section which states what Barclays expects of its customers.

So, do you only have to check the bank has carried out your instructions correctly, not all the transactions?

I know some of you will say that's just being picky but if they wanted it to refer to all transactions they should have put it in a general section and not a specific one.

Just to be clear, before anyone else insults me, I am not asking this question for myself, as I check my bank accounts religiously every day, but not everyone is as sad as me!

Hazzanet

As above, I've dug out my old "The law relating to domestic banking" book (Penn, Shea & Arora) which is incredibly out of date. To cut to the chase:

..."the customer is under no duty to check his statements, and that an estoppel cannot arise against him from his failure to do so, even if, say debits have occurred through the customer's negligence which has facilitated forgery. The most recent decision to this effect is Tai Hing Cotton Mill Ltd -v- Liu Chong Hing Bank Ltd and others to which reference has already been made. In that case the Privy Council held that a customer had no duty to the bank so to supervise his employees or agents so as to prevent forgeries and no duty to check his statements."

It goes on to say that if there is an express term in the bank/customer contract to bring this duty upon the customer then this has to meet the test of reasonableness within the meanings of the Unfair Contract Terms Act (the book was published in 1987 though).

Archi_Bald

I find it truly hard to believe that somebody wouldn't want to check their bank statements, or transactions online, at least once a month. I'd die of embarrassment if I had to admit I have so little grip on my own money.

YorkshireBoy

lissa_23 wrote: »

The part of the Barclays t&c's referred to above which says that you must check your statements is in the section relating to what Barclays will do when you give them instructions, saying you have to check they have carried out your instructions correctly, not in the section which states what Barclays expects of its customers.

Truthfully, had you read that before I posted the link?

So, do you only have to check the bank has carried out your instructions correctly, not all the transactions?

No, of course you don't!


But that section also talks about payments "into" your account, and you won't have initiated the payment instructions for many of those.


They go on to say they'll send you information on these (by various means).


They then say they'll put the same information (made available by the various aforementioned means) on your statement.


And finally, they say "you MUST" check the information they give you (on the statement).


Seems pretty clear cut (and reasonable) to me?