2002 PLP 1539 (CLD)

MUHAMMAD SAEED AKHTAR, J.‑‑‑The plaintiffs/ respondents filed a suit for recovery of Rs.8,89,052 against the appellant/ defendant. It was averred that the plaintiffs opened accounts with the defendant/Bank with its branch at Commercial Centre, Sattellite Town, Rawalpindi. In early 1878, the defendant/Bank froze the accounts of the plaintiffs on the pretext that the accounts were fictitious and that the plaintiffs were not genuine account‑holders. The plaintiffs tried to assure the defendant‑bank that the plaintiffs had genuinely opened their accounts but failed to prevail upon the bank. A Constitutional petition (W.P. No.5852 of 1978) before the High Court was filed where the bank offered that if the plaintiffs appear before the Manager of the defendant/bank and satisfy him that they were genuine persons and not fictitious account‑holders and if their signatures correspond with the specimen signatures with the bank, the bank will allow the plaintiffs to operate their accounts. The offer was accepted by the plaintiffs. They provided their signatures to the bank to enable the Manager to compare the same with their specimen signatures. The plaintiffs also quoted Bank Account No. 1000 opened by Mst. Siddiqa Akhtar mother of plaintiffs Nos. 3 to 6, sister‑in‑law of plaintiff No. 1 and a close relative of plaintiff No. 2 in the same branch of the defendant/bank and which was being operated by her. The Bank Manager though convinced of the genuineness of plaintiffs claim and their identity, showed his inability to allow the plaintiffs to operate their accounts on the plea that the higher Bank Authorities did not agree with him. The plaintiffs claimed that since the defendant/Bank is withholding the amounts lying to their credit in their respective bank accounts without any reasonable and just cause, they are entitled for the return of the principal amount alongwith the interest at the rate of 14% per annum with effect from 1‑12‑1977. The defendant resisted the suit on the ground of limitation and reiterated its stand that the accounts were fictitious. The following issues were framed:‑‑ (1) Whether the suit is time‑barred? OPD. (2) Whether the plaintiffs have no cause of action? OPD. (3) Whether the plaintiffs are genuine account holders of Accounts Nos. 1419, 1225, 946, 947, 950, 951 and are entitled to withdraw and operate the said accounts? OPP. (4) Relief. The evidence of the plaintiffs was recorded but defendant failed to produce any evidence in spite of many opportunities provided to them. Learned trial Court closed their evidence under Order 17, rule

3. C.P.C. on 24‑4‑1985. The learned trial Court vide its judgment/decree dated 13‑7‑1985 decreed the suit of the plaintiffs.

2. The learned counsel for the appellant contended that the suit was barred by time as the same had been filed after more than three years of the refusal of the operation of the bank accounts by the defendant/ bank. He submitted that the plaintiffs Nos. 5 and 6 were minors and the contract with the minors under section 11 of the Contract Act is void. He further argued that the learned trial Court could not award interest. Lastly he urged that the suit was bad for mis-joinder of parties.

3. Conversely, learned counsel for the respondents defended the impugned judgment.

4. The receipt of money by a banker from or on account of his customer constitutes him the debtor of the customer. The banker is normally liable to repay only the person from whom he received the money. The bank borrows the money and undertakes to repay it or any part of it at the branch of the bank where the account is kept during banking hours, and upon payment being demanded. Moreover, the bank undertakes to pay any part of the amount due against the written orders of the customer, the relationship here being one of agent and principal, a cheque being the principal's order to his agent to pay out of the principal's money in the agent's hands the amount of the cheque to the payee. The customer, on his part undertakes to exercise reasonable care in executing his written orders so as not to mislead the bank or make forgery easy and to act honestly towards the bank: for example, if he becomes aware that forged cheques are being presented, to inform the bank. The contract between banker and customer cannot be unilaterally varied. (Halsbury's Laws of England, Volume 3, para. 40). Anyone may be customer of a bank. An account may be opened by a married woman, a minor, trustee, executor, local' authority, unincorporated body or a company or corporation formed under the Companies Acts. A minor is a person who has not reached the age of eighteen years. An account may be opened with a minor so long as it is not allowed to be overdrawn, for a minor may be a creditor an overdraft is money lent and cannot be recovered against a minor.

5. The bank before opening the account of a prospective customer may satisfy itself as to the credentials of the person, applying to the bank for opening, the account. As stated above, the relationship of creditor and debtor comes into being after the opening of the account. Before the acceptance of cheques or negotiable instruments for payment, the bank has to compare the signatures of the customer on the cheques with the specimen signatures on the document in its possession. All considerations of justice, equity and good conscience shall prevail before denying the drawer its property. In the case in hand nothing has been brought on the record to show that the plaintiffs were fictitious persons and not genuine account holders. It is very unfortunate that the Bank withheld the money of its customer on flimsy pretext. If without justification, a banker dishonours his customer's cheque, he is liable to pay damages to the customer for the injury caused.

6. The contention of the learned counsel that the contract with the minor was void, has no force. The plaint shows that only two of the plaintiffs were minors. As stated above, the minor can open account with the bank. Under section 26 of the Negotiable Instruments Act (XXVI of 1881), where an instrument is made, drawn or negotiated by a minor, the making, drawing or negotiation entitles the holder to receive payment of such instrument and to enforce it against any party thereto other than the minor. The bank cannot refuse to make payment of the cheques issued by a minor. At any rate the minor can open the account through his guardian/next friend. The suit was also filed by the minors through guardian/next friend. Even otherwise, this protection was to be used as a shield and not as a sword. If a contract is for the infant's benefit the same cannot be used as a sword. The other plaintiffs are adults and no justification in law has been shown to freeze their accounts.

7. The next contention of the learned counsel for the appellant, that the trial Court could not award alleged interest, has equally no merit. No evidence was produced to show as to what was the prevalent bank rate at the time of the passing of the decree.

8. For what has been stated above, this appeal has no merit and is dismissed with no order as to costs. H.B.T./U‑28/L Appeal dismissed.