We first reported on this case in November of last year. A summary judgment was obtained by the liquidator of the claimant against the bank for conversion of the claimant’s cheques. The bank had credited its customer (U) with over 400 cheques which U had presented but to which it did not have title. The cheques belonged to the claimant, an associated company of U bearing a similar name. At first instance the court dismissed the bank’s defence under s4 Cheques Act 1957 that it had acted in good faith and without negligence. It held that the bank had no realistic prospect of establishing it had not been negligent, and it also found that the names on the cheques had not been checked. However, there had also been unchallenged evidence of current banking practice from the bank to the effect that a sufficient match of names was good compliance and the bank appealed.

The Court of Appeal held that current banking practice was highly relevant to the issue of negligence, and the bank’s evidence about its practice, especially if unchallenged, was relevant evidence of the current practice of bankers. The judge had not been entitled to reject out of hand or disregard the bank’s evidence that the current banking practice was that a sufficient match of names was acceptable, and that the names in question did in fact sufficiently match. That evidence raised an arguable case on the absence of negligence. Further, the bank’s evidence that there was nothing in the circumstances to put it on enquiry could not be summarily rejected. Therefore, at this summary stage, the judgment was set aside, and the claim will now proceed to trial.

Architects of Wine Ltd (A company registered in the Cayman Islands) (In Liquidation) v Barclays Bank Plc