WorksheetsQuiz on Banker-Customer Relationship
Total questions: 15
Worksheet time: 8mins
What is the primary nature of the banker-customer relationship?
A constructive trustee relationship
An agent-principal relationship
A debtor-creditor relationship
A fiduciary relationship
Which case defined the banker as someone who accepts money from customers?
Bank of Chettinad v Commissioner of Income Tax
Commonwealth v Bank of New South Wales
Barclays Bank Ltd v. Okenarhe
Robinson v Midland Bank Ltd
According to the Financial Services Act 2013, what is the definition of 'banking business'?
None of the above
Only providing loans
Only accepting deposits
Accepting deposits and providing loans
In which case was it held that a person is regarded as a customer when their money is accepted by a bank?
Foley v Hill
Oriental Bank of Malaya v Rubber Industry
Siegfried Joachimson case
United Dominions Trust Ltd v Kirkwood
What is the implication of the debtor-creditor relationship in banking?
The bank can use the customer's money without restrictions
The bank must obtain consent from the customer before using the money
The customer must obtain consent from the bank to demand the repayment
The customer has no rights to the deposited money
The following are the requirements for the establishment of a constructive trustee EXCEPT
Existence of a dishonest and fraudulent design on the part of the trustee
Existence of trust
Knowledge of the stranger (dishonesty on the part of the stranger
Ignorance of the stranger about the fraudulent design
What does the term 'fiduciary relationship' imply in the context of banking?
The relationship is purely contractual
The customer has no right to sue the bank
The bank must act in the best interest of the customer
The bank acts solely for its own benefit
In the case of Barclays Bank Ltd v. Okenarhe, what was determined about a person cashing a cheque without an account?
They are considered a customer
They are not considered a customer
They have the same rights as a customer
They can demand repayment
Which case established that a banker is not liable to repay the deposited money until a demand is made?
United Dominions Trust Ltd v Kirkwood
Robinson v Midland Bank Ltd
Joachimson v Swiss Bank Corporation
Foley v Hill
What is the significance of the term 'implied terms' in the banker-customer relationship?
They must be explicitly stated in contracts
They are understood without being stated and has legal effect
They only apply to loans
They are not legally binding
What does the term 'debtor' refer to in the context of a loan?
The guarantor of the loan
The customer receiving the loan
The government regulating the loan
The bank providing the loan
In the context of banking, what does the term 'credit' refer to?
The amount of money a bank lends
The amount of money a customer can withdraw
The amount of money a customer owes
The total assets of the bank
In Woods v Martin Bank Ltd & Anor [1959] 1 QB 55, the Bank was held liable for breach of ___________ when it granted a huge amount of ______ to a certain company and advised Woods to invest in that company, which later suffered losses.
debtor-customer relationship, deposit
fiduciary relationship, overdraft
agency relationship, overdraft
fiduciary relationship, deposit
In the case of Lipkin Gurman v Karpnale Ltd and Lloyds Bank plc [1992] 4 All ER 409, the Bank was not liable as constructive trustee because they did not provide __________
financial assistance
financial advisory
knowing assistance
no correct answer
What is the principle laid down in the case of •Westminster Bank Ltd v Hilton (1926) 43 TLR 124
The terms “banking” and “bank” may bear different shades of meaning at different periods of history, their meaning may not be uniform in countries due to different habits of life and degrees of civilization.
At the moment a person has his money accepted by a bank on the understanding that he may draw cheques up to the amount standing in his account with the banker, that person is regarded as the latter’s customer.
The trade of a banker is to receive money – to use it as he pleases as if it were his own – not guilty of breach of trust in employing it
As regards to the drawing and payment of cheque, the relationship between bank and customer is that of principal and agent
