Banking and Finance Law Essay

1007 Words Sep 11th, 2009 5 Pages
Name: Tran Cong Hieu
Student ID: 15402543
Word count: 986

Can Fantastic Landscapes Pty. Ltd. have the right to sue Red Bank to claim $50,000 which Minnie has stolen?
Can Fantastic Landscapes Pty. Ltd. sue Red Bank for compensation for the $10,000 penalty fee?
Can Fantastic Landscapes Pty. Ltd. seek compensation from BLB?
Firstly, who is the customer?
Secondly, content of the contact at (2.65) states that: the contact between the bank and the customer is ongoing one. It exists until terminated pursuant to contractual principles, which could include agreement of the parties or breach of the condition entitling the innocent party to terminate.
Thirdly, the bank’s duty
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The general terms and conditions included the following clause 12: upon receipt of each monthly overdraft account statement, the account holder shall read the statement and notify the bank of any errors contained in the statement within 15 days. Failure to notify the bank of any errors within that time will be treated as a breach of contract by the account holder entitling the bank to its remedies at law.
Applying to the bank’s duty of confidentiality, the Red Bank recorded transactions between it and its customer (Fantastic Landscapes) and reported to its customer every 15 days as written in the general term. However, Red Bank did not complete its duty to question valid mandate because the cheques drawn by Minnie (one of the director of Fantastic Landscapes) within a period of 3 months are unusual drawn on Fantastic Landscapes’ overdraft account.
When according to joint account holders, Ben actually is an innocent joint account holder, so he has a right to sue the Red Bank for the breach of contract.
However, applying to the duty of customer in section duty to organize business, following cases: Lewes Sanitary Steam Laundry Co Ltd v Barclay Co Ltd (1906) 95 LT 444; and (6.21) National Bank of New Zealand Ltd v Walpole and Patterson Ltd (1975) 2NZLR 7. The Red bank has an absolute

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