South Africa Act or statute

Parliament of the Republic of South Africa

Bills of Exchange Amendment Act, 2000

amendmentauditsbank authorisationbank liabilitybank reconciliationBanking and financebanking terminologybill completionbill paymentbill transferbills and negotiable instrumentsbills and notesbills of exchangecheque collectioncheque crossingcheque custodycheque handlingcheque paymentcheque presentmentcheque processingcheque-equivalent treatmentchequescontract formationcontract interpretationcorporate signingcourt procedurecrossed chequesdebt recoverydefinitionsdishonourdocument executiondocument payment processingdocumentsendorsementfinancial statementsfraud preventionguaranteesliabilitylitigationloss and theft recoverylost or destroyed instrumentsnegotiable instrumentsnotespayment instructionspayment instrumentspayment processingpaymentsprotestprotest of bills and notesrepealsignature authoritysignature liabilitysignaturessigning liabilitystatutory draftingstatutory repeal

Jurisdiction: South Africa
Structure: 56 provisions
Citation: Act 56 of 2000
Dates: updated 6 Dec 2000

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Dates: updated 6 Dec 2000

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Purpose and legislative effect

“This provision amends section 1 of the Bills of Exchange Act, 1964 by changing several definitions, including bank, cheque, collecting bank, non-business day, and note, and by deleting some definitions.”

This provision amends section 1 of the Bills of Exchange Act, 1964 by changing several definitions, including bank, cheque, collecting bank, non-business day, and note, and by deleting some definitions. A bill may be treated as payable to bearer if the payee is fictitious, non-existing, or lacks capacity to contract. A bill counts as payable to bearer in certain cases, including where it is expressed that way, endorsed in blank, or made payable to cash or cash or order. Section 13 of the principal Act is repealed. If someone signs a blank paper and hands it over to be turned into a bill, that delivery gives the recipient prima facie authority to complete it as a bill.

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Section 1 of the Bills of Exchange Act, 1964 (hereinafter referred to as the principal

Section 1

Section 49 of the principal Act is hereby amended-

Rules about dishonoured bills are adjusted: a dishonoured bill may be protested, protesting is not required to hold the drawer or an indorser liable, and if the cause of delay ends, the bill must be protested with reasonable diligence.

Section 14

Section 70 of the principal Act is hereby amended—

This section amends section 70 of the principal Act and changes rules for interpreting certain bill contracts by the law of the place where the contract was made, with a specific exception for an inland bill payable in the Republic and endorsed outside the…

Section 26

The following section is hereby substituted for section 78 of the principal Act:

Banks must follow special rules when paying crossed cheques and may be liable if they pay contrary to those rules.

Section 36

This Act is called the Bills of Exchange Amendment Act, 2000, and comes into

This section says the Act is named the Bills of Exchange Amendment Act, 2000, and starts when the President sets a date by proclamation in the Gazette.

Section 47

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Showing 56 of 56 provisions

Substitution 30Repeal 13Amendment 9Provision 2

§ 1Section 1 of the Bills of Exchange Act, 1964 (hereinafter referred to as the principalSubstitution

1. Section 1 of the Bills of Exchange Act, 1964 (hereinafter referred to as the principal 5 Act), is hereby amended— (a) by the deletion of the definition of “action”; (b) by the substitution for the definition of “banker” of the following definition: “[’banker’ includes] ‘bank’ means a body of persons, whether incorporated or not, [who carry] that carries on the business of banking, and includes the South African Reserve Bank contemplated in the South African Reserve Bank Act, 1989 (Act No. 90 of 1989), a bank as] defined in section 1 of the Banks Act,’ 1990 (Act No. 94 of 1990), a mutual bank as defined in section 1 of the Mutual Banks Act, 1993 (Act No. 124 of 1993). and the Post Office Savinm Bank as defined in section 1 of the Post O~ce Act, 1958 (Act No. 44~f 1958);”; (c) bv the substitution for the definition of “cheque” of the following definition: ,,. “ ‘cheque’ means a bill drawn on a [banker] bank payable on demand;”; (d) by the insertion after the definition of “cheque” of the following definition: “ ‘collecting bank’ means a bank collecting payment of a cheque or other document contemplated in section&”; (e) by the deletion of the definition of “foreign bill”; (H by the deletion of the definition of “inland bill”; (g) by the substitution for the definition of “non-business day” of the following definition: 10 1.5 20 25 . ,“. . 4 ‘4(7 2 I S4(1 [ioVI:RN\li-hT G \ZFITE. (, DECEMBER 20!)() “ 'no[l-[7usitle\ sd:ly`tlleatls ;iduyccJillelll~ll:lted illsectioll @r/r] 30 fthe Public Holid:i!rs Act. [1952 (Act No. 5 of’ 1952)] 1994 (Act No: 36 of 1994):”: . (h) by the substitution for the definition of “note”, used as a noun, of the following definition: ‘ ‘note’ [used as a noun] mews d promissol-y note as &fined in section S7:”’: (i) by the deletion of the definition of “note” used as a verb: (j) by the deletion of the definition of “Pos[ Oftice cheque”: (k) by the deletion of the definition of “value”: and (1) by the deletion of the definition of “uari-antlolicl~ er”’. Amendment of section 5 of Act 34 of 1964

Section 1Verify source

§ 2Section 5 of the principal Act is hereby amended by the substitution for subsectionSubstitution

A bill may be treated as payable to bearer if the payee is fictitious, non-existing, or lacks capacity to contract.

2. Section 5 of the principal Act is hereby amended by the substitution for subsection (3) of the following subsection: “(3) If the payee is a fictitious or non-existing person. or a person not ha)’ing capacity to contract. the bill may be treated as payable to bearer.”. Amendment of section 6 of Act 34 of 1964 5 10 15

Section 2Verify source

§ 3Section 6 of the principal Act is hereby amended by the substitution for subsectionRepeal

A bill counts as payable to bearer in certain cases, including where it is expressed that way, endorsed in blank, or made payable to cash or cash or order.

3. Section 6 of the principal Act is hereby amended by the substitution for subsection (2) pf the following subsection: “(2) A bill is payable to bearer if it is expressed to be so payable, or if the only or last endorsement on it is an endorsement in blank, or if it- is expressed to be payable to the order of ‘cash’ or to ‘cash or order’.”. 20 Repeal of section 13 of Act 34 of 1964

Section 3Verify source

§ 4Section 13 of the principal Act is hereby repealed.Repeal

Section 13 of the principal Act is repealed.

4. Section 13 of the principal Act is hereby repealed. Amendment of section 18 of Act 34 of 1964

Section 4Verify source

§ 5Section 18 of the principal Act is hereby amended by the substitution for subsectionSubstitution

If someone signs a blank paper and hands it over to be turned into a bill, that delivery gives the recipient prima facie authority to complete it as a bill.

5. Section 18 of the principal Act is hereby amended by the substitution for subsection 25 ( 1 ) of tbe following subsection: “(1 ) If a person places his signature upon [and affixes a stamp to] a blank paper and delivers such paper to any other person in order that it may be converted into a bill. it operates as a prima facie authority to fill it up as a complete bill for any amount [such a stamp will cover], using the said signature for that of the drawer, the acceptor or an endorser. ”. Amendment of section 19 of Act 34 of 1964

Section 5Verify source

§ 6Section 19 of the principal Act is hereby amended by the substitution for subsectionRepeal

A bill contract is not complete and irrevocable until the instrument is delivered, unless an acceptance or aval is written on the bill and notice is given to the person entitled to the bill.

6. Section 19 of the principal Act is hereby amended by the substitution for subsection (1) of the following subsection: “(1 ) No contract on a bill, whether it be the drawer’s, the acceptor’s, [or] an indorser’s, or that of the signer of an aval, shall be complete and irrevocable, until delivery of the instrument in question in order to conclude such a contract: Provided that if an acceptance or an aval is written on a bill and the drawee or the signer of the aval. as the case may be, gives notice to, or according to the directions of, the person entitled to the bill that he has accepted or signed it, the acceptance or — aval then becomes complete and irrevocable.”. – 30 35 40 Repeal of section 23 of Act 34 of 1964

Section 6Verify source

§ 7Section 23 of the principal Act is hereby repealed.Repeal

Section 23 of the principal Act is repealed.

7. Section 23 of the principal Act is hereby repealed. Amendment of section 24 of Act 34 of 1964

Section 7Verify source

§ 8Section 24 of the principal Act is hereby amended by the substitution for the wordsSubstitution

A person who signs a bill in a representative way is not personally liable on it.

8. Section 24 of the principal Act is hereby amended by the substitution for the words 45 preceding the proviso to subsection ( 1 ) of the following words: I 6 xo. 21846 GOVERNMENT GAZETTE. 6 DECEMBER 2000 Act No. 56,2000 BILLS OF EXCHANGE AMENDMEh’T ACT. 2000 “If a person signs a bill as drawer, acceptor or indorser and adds words to his signature indicating that he signs for or on behalf of a principal, or in a representative capacity. or if he signs as drawer and the name of the principal appears with his signature, he is not personally liable thereon:”. Substitution of section 25 of Act 34 of 1964 5

Section 8Verify source

§ 9The following section is hereby substituted for section 25 of the principal Act:Substitution

This section replaces section 25 of the principal Act.

9. The following section is hereby substituted for section 25 of the principal Act: “Holder for value

Section 9Verify source

§ 25A holder takes a bill for value if he takes it under onerous title.”.Amendment

A holder takes a bill for value if it is taken under onerous title.

25. A holder takes a bill for value if he takes it under onerous title.”. Amendment of section 29 of Act 34 of 1964

Section 25Verify source

§ 10Section 29 of the principal Act is hereby amended by the substitution for 10Substitution

If a holder transfers a bill payable to their order without endorsing it, the transferee gets the holder’s title and can require the transferor to endorse the bill.

10. Section 29 of the principal Act is hereby amended by the substitution for 10 subsection (4) of the following subsection: “(4) If the holder of a bill payable to his order transfers it [for value] without indorsing it, the transfer gives the transferee such title as the transferor had in the bill, and the transferee in addition acquires the right to have the bill indorsed by the transferor.”. 15 Amendment of section 30 of Act 34 of 1964

Section 10Verify source

§ 11Section 30 of the principal Act is hereby amended by the substitution forSubstitution

This section amends section 30 of the principal Act, replacing subsection (5) about bills payable to order when the payee or indorsee is wrongly named or misspelt.

11. Section 30 of the principal Act is hereby amended by the substitution for subsection (5) of the following subsection: “(5) If in a bill payable to order, the payee or indorsee is wrongly designated, or his name is misspelt, he [must] ~, in order to effect a negotiation of the bill, 20 indorse the bill as he is therein described, adding, if he thinks fit, his proper signature.”. Amendment of section 39 of Act 34 of 1964

Section 11Verify source

§ 12Section 39 of the principal Act is hereby amended by the substitution forSubstitution

This section amends section 39 by replacing paragraph (a) of subsection (2), including the wording about when the drawee is dead, insolvent, fictitious, non-existing, or lacks capacity to contract.

12. Section 39 of the principal Act is hereby amended by the substitution for paragraph (a) of subsection (2) of the following paragraph: “(a) if the drawee is dead or insolvent, or is a fictitious or non-existing person or a person not having capacity to contract [by bill];”. Insertion of section 43A in Act 34 of 1964

Section 12Verify source

§ 13The following section is hereby inserted in the principal Act after section 43:Amendment

A collecting bank may present a cheque for payment to the drawee for the holder, including by agreed data transmission, if the stated section 43 requirements are met.

13. The following section is hereby inserted in the principal Act after section 43: “Presentment for payment by bank 43A. (1) A cheque may, provided the requirements of subsection (1), paragraphs (a) and (b) of subsection (2) and subsection (3) of section 43 are met, be presented for payment to the drawee by a collecting bank on behalf of the holder— (a) at a place designated in the rules of any clearing house of which both the drawee bank and the collecting bank are members; (b) at a place of payment designated by the drawee bank; or (c) by means of data transmitted in terms of an agreement to which both the drawee bank and the collecting bank are party by, or on behalf of, the collecting bank to the drawee bank, identifying the cheque with reasonable certainty. (2) For the purpose of paragraph (c) of subsection (1), a cheque is deemed to be identified with reasonable certainty if— (a) the sum ordered to be paid by the cheque; ( b ) t h e . n u m b e r o f the c h e q u e , i f a n y; 25 30 35 40 45 I I I 8 h,,, ~ ] ~.$(j — —________ GO V’ERNIWENT [iAZETTl;. 6 DECEAIBER 2000” — — _ _ _ _ __ Act NO. %, ~~~() BI[.LS OF FXCH.4NGE AMENDMENT ACT. 2000 fc) the name and number of the account against which the cheque is drawn: and (d) the drawee bank, are specified or are readily ascertainable by the dravee bank from the clata transmitted by or on behalf of the collecting bank, (3) Where a cheque is presented for payment in terms of this section, the drawee shall not be relieved of any liability to which the drawee would have been subject in relation to the cheque if it had been presented by being exhibited to the drawee. “’. 5 Amendment of section 49 of Act 34 of 1964, as amended by section 3 of Act 58 of 10 1977

Section 13Verify source

§ 14Section 49 of the principal Act is hereby amended-Substitution

14. Section 49 of the principal Act is hereby amended- (a) by the deletion of subsection (1); (b) by the substitution for subsection (1A) of the following subsection: “(1 A) (a) If [an inland] q bill has been dishonored by non- 15 acceptance or non-payment it may be protested for non-acceptance or non-payment, as the case may be, but it shall not be necessary so to protest any such bill to hold the drawer or any indorser liable. (b) If [such] a bill drawn payable at the place of business or residence of some person other than the drawee, has been dishonored by 20 non-acceptance it may be protested for non-payment. and in such event no further presentment for payment to, or demand on, the drawee is necessary.”; (c) by the deletion of subsection (8); and (d) by the substitution for the proviso to subsection (9) of the following proviso: 25 “Provided that if the cause of delay ceases to operate, the bill must be protested [when necessary] with reasonable diligence,”. Amendment of section 50 of Act 34 of 1964

Section 14Verify source

§ 15Section 50 of the principal Act is hereby amended by the substitution forSubstitution

A bill holder must show the bill to the person demanding payment, and must hand it over when it is paid.

15. Section 50 of the principal Act is hereby amended by the substitution for subsection (4) of the following subsection: “(4) Subiect to the provisions of section 43A, when a holder of a bill presents it for payment, he shall exhibit the bill to the person from whom he demands payment, and when a bill is paid, the holder shall forthwith deliver it up to the party paying it.”. Substitution of section 54 of Act 34 of 1964 30 35

Section 15Verify source

§ 16The following section is hereby substituted for section 54 of the principal Act:Substitution

This section substitutes section 54 of the principal Act with a provision titled “Liability of stranger signing bill.”

16. The following section is hereby substituted for section 54 of the principal Act: “Liability of stranger signing bill

Section 16Verify source

§ 54If a person signs a bill otherwise than as drawer, [or] acceptor, signerProvision

If someone signs a bill in a capacity other than drawer, acceptor, aval signer, or drawee certifying a cheque, they take on an indorser’s liabilities to a holder in due course.

54. If a person signs a bill otherwise than as drawer, [or] acceptor, signer of an aval or drawee certifying a cheque, he thereby incurs the liabilities of an indorser to a holder in due course.”. 40 Insertion of section 54A in Act 34 of 1964

Section 54Verify source

§ 17The following section is hereby inserted in the principal Act after section 54:Amendment

A person who signs a bill or note as an aval becomes liable as a surety for the party covered by the aval.

17. The following section is hereby inserted in the principal Act after section 54: “Liability of signer of aval 54A. (1) ‘I’he liabilities Of the parties to a bill or note may be secured b I an aval. ----+ ~, 10 ——— No. 21846 Act No. 56,2000 — — — — —. GOVERNMENT GAZETTE. 6 DECEMBER 2’000 — BILLS (3F EXCHANGE AMENDh!ENT ACT. 2000 (2) A person signs a bill or note m the signer of an aval where he signs the bill or note, and by words such as ‘as aval’, ‘as surety’ or ‘as guarantor” expressly indicates that he is a surety: Provided that the unqualified signature of a person other than the drawer. maker, drawee or payee made on the back of the bill or note payable to order before endorsement by the payee shall be sufficient for such indication. (3) The signer of an aval may specify in the bill or note the party for whom he has given his aval and if he does not so specify, he shall be deemed to have given his aval for the drawer or maker, as the case may be: Provided that, if a bill has been accepted, whether before or after the signing of the aval, the signer of that aval shall be deemed to have given his aval for the acceptor. (4) The signer of an aval is liable jointly and severally with and as surety for, the party for whom he has given his aval or is deemed to have given his aval. (5) Where the signer of an ava] pays the bill or note, he acquires the rights arising out of the bill or note against the person for whom he has given his aval or is deemed to have given his aval and against all parties liable to that P!XQz”. Amendment of section 55 of Act 34 of 1964

Section 17Verify source

§ 18Section 55 of the principal Act is hereby amended—Substitution

This section amends section 55 so that, after a dishonored bill, the holder may recover from liable parties, and a drawer or indorser who has paid may recover from specified others.

18. Section 55 of the principal Act is hereby amended— (a) by the substitution for subsection (1) of the following subsection: 5 10 15 20 “(1 ) [Subject to the provisions of sub-sections (2) and (3)] If a bill is dishonored, the holder may recover from any party liable on the bill, and the drawer, if he has been compelled to pay the bill, may recover 25 from the acceptor, and an indorser who has been compelled to pay the bill, may recover from the acceptor, the drawer or a prior indorser as damages, which shall be deemed to be liquidated- (i) the amount of the bill; (ii) interest thereon from the time of presentment for payment if the 30 bill is payable on demand, or from the maturity of the bill in any other case[; (iii) the expenses of noting, and if protest is necessary and has been extended, the expenses of the protest].”; and (b) by the deletion of subsections (2) and (3). Amendment of section 58 of Act 34 of 1964

Section 18Verify source

§ 19Section 58 of the principal Act is hereby amended by the substitution for the wordRepeal

This section amends Section 58 of the principal Act by replacing “banker” with “bank” wherever it appears, and it repeals section 63 of Act 34 of 1964.

19. Section 58 of the principal Act is hereby amended by the substitution for the word “banker” of the word “bank” wherever it occurs. Repeal of section 63 of Act 34 of 1964

Section 19Verify source

§ 20Section 63 of the principal Act is hereby repealed.Repeal

Section 63 of the principal Act is repealed.

20. Section 63 of the principal Act is hereby repealed. Repeal of section 64 of Act 34 of 1964

Section 20Verify source

§ 21Section 64 of the principal Act is hereby repealed.Repeal

Section 64 of the principal Act is repealed.

21. Section 64 of the principal Act is hereby repealed. Repeal of section 65 of Act 34 of 1964

Section 21Verify source

§ 22Section 65 of the principal Act is hereby repealed.Repeal

This section repeals section 65 of the principal Act and refers to repeal of section 66 of Act 34 of 1964.

22. Section 65 of the principal Act is hereby repealed. Repeal of section 66 of Act 34 of 1964

Section 22Verify source

§ 23Section 66 of the principal Act is hereby repealed.Repeal

Section 66 of the principal Act is repealed.

23. Section 66 of the principal Act is hereby repealed. 35 40 45 12 —..— No 21846 Act NO. 56, 2000 — GO\’ ERNMENT GAZETTE, 6 DECEMBER 2000 — BILLS C)F EXCHANGE .4 M13’DMENT ,4 CT, 2000 Substitution of section 67 of Act 34 of 1964 I

Section 23Verify source

§ 24The following section is hereby substituted for section 67 of the principal Act:Substitution

If a bill or note is lost or destroyed before it is overdue, the holder may ask the drawer or maker for a replacement of the same tenor, and may need to give adequate security to indemnify them if the original is found again.

24. The following section is hereby substituted for section 67 of the principal Act: “Holder’s rights if bill or note is lost or destroyed 67. (1) If a bill or note is lost or destroyed before it is overdue, the person who was the holder of it may request the drawer or maker to give him 5 another bill or note. as the case may be, of the same tenor, givin: adequate security to the drau)er or maker, if required, to indemnify him against all persons whatever in case the bill or note alleged to have been lost ~ destroyed is found again. (2) If the drawer or maker on such request refuses to give such bill or note 10 he may be compelled to do so.”. Substitution of section 68 of Act 34 of 1964

Section 24Verify source

§ 25The following section is hereby substituted for section 68 of the principal Act:Substitution

Section 25 substitutes a new section 68 of the principal Act about action upon a lost bill or note.

25. The following section is hereby substituted for section 68 of the principal Act: “Action upon lost bill or note

Section 25Verify source

§ 68In any action or proceeding upon a bill or note, other than a 15Amendment

In court proceedings on a bill or note, the court may order that loss or non-production of the instrument cannot be used as a defence if an indemnity is provided.

68. In any action or proceeding upon a bill or note, other than a 15 proceeding for provisional sentence. the court may order that the loss or non-production of the instrument shall not be set up by way of defence, provided an indemnity be given to the satisfaction of the court against the claims of any other person upon the instrument in question.”. Amendment of section 70 of Act 34 of 1964, as amended by section 4 of Act 58 of 20 1977

Section 68Verify source

§ 26Section 70 of the principal Act is hereby amended—Substitution

26. Section 70 of the principal Act is hereby amended— (a) by the substitution in paragraph (a) for the words preceding subparagraph (i) of the following words: “the validity of the bill as regards requisites in form is determined by the 25 law of the place of issue, and the validity, as regards requisites in form, of every supervening contract, such as acceptance, endorsement [or acceptance for honour .rupru protest] or that of an aval, is determined by the law of the place where such contract was made, but—”: and (b) by the substitution for paragraph (b) of the following paragraph: 30 “(b) subject to the provisions of this Act, the interpretation of the contract of the drawer, indorser, acceptor [or acceptor for honour supra protest] or signer of an aval of a bill is determined by the law of the place where such contract is made: Provided that if [an inland] a bill payable in the Republic is indorsed outside the 35 Republic~the endorsement shall as regards the payer be interpreted according to the law of the Republic;”. Amendment of section 71 of Act 34 of 1964

Section 26Verify source

§ 27Section 71 of the principal Act is hereby amended by the addition of the followingAmendment

The Act says its cheque provisions also apply to a bill drawn by a bank on itself and payable on demand.

27. Section 71 of the principal Act is hereby amended by the addition of the following subsection, the existing section becoming subsection (1): “(2) Notwithstandin,q the provisions of subsection (2) of section 3, the provisions of this Act applicable to a cheque apply to a bill drawn by a bank on itself and payable on demand.”. Amendment of section 72 of Act 34 of 1964

Section 27Verify source

§ 28Section 72 of the principal Act is hereby amended—Substitution

The section changes the wording so “banker” becomes “bank” and gives the holder of a cheque a right to recover the amount from the bank to the extent of the discharge.

28. Section 72 of the principal Act is hereby amended— 40 4.5 1 ~ I I 1 14 — No. 21846 - . . — __ GO\’ERNMEhTT wA2%TTE. 6 DECEMBER 2000 ———— .——— Act NO. 56, 2000 BILLS OF J5XCHANGE AMENDMENT ACT. 2000” (a) by the substitution for the word “banker” of the word “bank” wherever it occurs in paragraph (u) of subsection (1); and (b) by the substitution for paragraph (b) of subsection (I) of the following pmagraph: “(b) the holder of a cheque as to which such drawer or person is so 5 discharged shall be a creditor, in Iieu of such drawer or person, of such [banker] bank to the extent of such discharge, and be entitled to recover the amount from [him] ~“; and (c) by the substitution for the word “bankers” of the word “banks” in subsection (2). 10 Insertion of sections 72A and 72B in Act 34 of 1964

Section 28Verify source

§ 29The following sections are hereby inserted in the principal Act after section 72:Provision

If a drawee certifies a cheque, it must pay as stated and cannot deny certain facts to a holder in due course.

29. The following sections are hereby inserted in the principal Act after section 72: “Liability of drawee who has certified cheque 72A. (1) A cheque is certified if the drawee signs it and adds words to the cheque that indicate that the cheque will be paid or that funds are available 15 for its payment. (2) When a drawee of a cheque certifies it he— (a) (b) undertakes that he will pay the holder, or the drawer or an indorser who has been compelled to pay the cheque, the amount recoverable in terms of section 55 according to the tenor of his certification; is precluded from denying to a holder in due course— (i) the existence of the drawer, the genuineness of his signature and his capacity and authority to draw the cheque; ~xistence Of the payee and his then capacity to indorse. Prevention of fraud I 20 25

Section 29Verify source

§ 72BAny person who is required by law to have his financial statementsSubstitution

Some persons must take reasonable care with cheque forms and bank statement reconciliation.

72B. Any person who is required by law to have his financial statements audited by a person registered in terms of section 15 of the Public Accountants’ and Auditors’ Act, 1991 (Act No. 80 of 1991), or by the Auditor-General, and any person obliged to appoint an accounting officer in terms of section 59 of the Close Corporations Act, 1984 (Act No. 69 of 30 1984), shall exercise reasonable care in the custody of cheque forms and in the reconciliation of its bank statements.”. Substitution of section 73 of Act 34 of 1964

Section 72BVerify source

§ 30The following section is hereby substituted for section 73 of the principal Act:Substitution

This section substitutes a new section about revoking a bank’s authority.

30. The following section is hereby substituted for section 73 of the principal Act: “Revocation of bank’s authority

Section 30Verify source

§ 73The duty and authority of a [banker] bank to pay a cheque drawn onRepeal

A bank’s duty and authority to pay a customer’s cheque end when it receives a countermand or notice of the customer’s death, incapacity, or insolvency-related status, if the notice properly identifies the cheque/customer and gives the bank a reasonable chance to act.

73. The duty and authority of a [banker] bank to pay a cheque drawn on [him] ~ by [his] & customer are [determined] terminated by receipt of— (a) countermand of payment; (b) [receipt ofi notice of the customer’s death or incapacity; (c) [receipt ofl notice of the customer having [become insolvent] been—. seque~trated or wound-up or placed under judicial management or declared a prodigal: Provided such countermand or notice identifies the cheque, in the case of countermand, and the customer with reasonable particuku-ity and gives the drawee a reasonable opportunity to act on it.”. —.— 35 40 45 Repeal of section 74 of Act 34 of 1964

Section 73Verify source

§ 31Section 74 of the principal Act is hereby repealed.Repeal

Section 74 of the principal Act is repealed.

31. Section 74 of the principal Act is hereby repealed. 16 N(), 21846 — —_ GO\’ERNM13$T GAZETTE, () DECE1113ER 2000” —— —. Act NO. 56.2000 BiL.I_S (IF EXCHANGE AMENDhlENT ACT. X)(k) Amendment of section 75 of Act 34 of 1964

Section 31Verify source

§ 32Section 75 of the principal Act is hereby arnended—Substitution

This section amends the cheque-crossing rules in section 75.

32. Section 75 of the principal Act is hereby arnended— (a) by the substitution for subsection (1) of the following subsection: “(1 ) If a cheque bears across its face an addition of [— (a) the words ‘and Company’, or any abbreviation between two parallel transverse lines, either without the words ‘not negotiable’; or thereof, with or 5 (b)] two parallel transverse lines [simply]. either with or without the words ‘not negotiable’, that addition constitutes a crossing and the cheque is crossed generally. “’; and (b) by the substitution for subsection 2 of the following subsection: “(2) If a cheque bears across its face an addition of the name of a [banker] bank. either with or without the words ‘not negotiable’ or ‘and Company’ or any abbreviation thereof. that addition constitutes a crossing and the cheque is crossed specially and to that [banker] bank,”’. 10 15 Insertion of section 75A in Act 34 of 1964

Section 32Verify source

§ 33The following section is hereby inserted in the principal Act after section 75:Amendment

Cheques marked 'not transferable' or 'non transferable' cannot be transferred, and banks are protected from negligence claims based only on ignoring transfer-blocking endorsements or words.

33. The following section is hereby inserted in the principal Act after section 75: “hTon-transferable cheques 75A, ( 1 ) Where a cheque bears boldly across its face the words ‘not transferable’ or ‘non transferable’, either with or without the word “only’ after the pa!ee’s nanle— (a) the cheque shall not be transferable but shall be valid as between the parties thereto: (b) the cheque shall be deemed to be crossed generally, unless it is crossed specially: and (c) the words ‘not transferable’ or ‘non transferable’ may not be cancelled and any purported cancellation shall be of no effect. (2) A bank shall not be negligent by reason only of its failure to concern itself with— (a) an endorsement intended to prevent transfer of the cheque; or (b) words rxohibitin~ transfer, or indicating an intention that it shall not be transferable, other than in the manner ~rovided for in this section.”. !- I Amendment of section 76 of Act 34 of 1964

Section 33Verify source

§ 34Section 76 of the principal Act is hereby amended-Substitution

This provision amends section 76 about how cheques may be crossed.

34. Section 76 of the principal Act is hereby amended- (a) by the substitution for subsection (1) of the following subsection: “(1 ) A cheque may be crossed generally or specially by the drawer ~ a collecting bank,”; (b) by the substitution for subsection (5) of the following subsection: “(5) If a cheque is crossed specially. the [banker] &@ to [whom] which it is crossed may again cross it specially to another [banker] bank for collection.”; and (c) by the deletion of subsection (6). 40 Substitution of section 77 of Act 34 of 1964

Section 34Verify source

§ 35The following section is hereby substituted for section 77 of the principal Act:Substitution

This section substitutes a new section 77 of the principal Act titled “Crossing material part of cheque”.

35. The following section is hereby substituted for section 77 of the principal Act: “Crossing material part of cheque 45

Section 35Verify source

§ 77A crossing authorized by this Act is a material part of the cheque, andSubstitution

A person must not erase, cancel, add to, or alter a crossing on a cheque unless the Act authorizes it.

77. A crossing authorized by this Act is a material part of the cheque, and 18 No. 21846 G(JVLRNMENT GAZETTE. 6 DECEMBER 2000 — Act NO. 56, 2000 BILLS OF EXCHANGE AMENDMENT ACT. 2000” it shall not be lawful for any person to obliterate, cancel or, except as authorized by this ACI, to add to or alter such a crossing.”, Substitution of section 78 of Act 34 of 1964

Section 77Verify source

§ 36The following section is hereby substituted for section 78 of the principal Act:Substitution

Banks must follow special rules when paying crossed cheques and may be liable if they pay contrary to those rules.

36. The following section is hereby substituted for section 78 of the principal Act: “Duties of banks as to crossed cheques 78. (1) If a cheque is crossed generally, the [banker] bank on [whom] which it is drawn shall not pay it to any person other than a [banker] bank.”; (2) If a cheque is crossed specially, the [banker] bank on [whom] which it is drawn shall not pay it to any person other than the [banker] bank to [whom] which it is crossed, or the latter’s agent for collection, if [he] ~ is a [banker] bank, (3) If a cheque is crossed specially to more than one [banker] ~, except when crossed to two [bankers] banks of [whom] which the one is an agent for collection of the other, the [banker] bank on [whom] which it is drawn shall refuse payment thereof. (4) If the [banker] bank on [whom] which a cheque is drawn— (a) pays such cheque if it is crossed as is contemplated in sub-section (3); (b) pays such cheque to any person other than a [banker] bank if it is crossed generally; or (c) pays such cheque, if it is crossed specially, to any person other than the [banker] bank to [whom] which it is crossed or the latter’s agent for collection, if [he] ~ is a [banker] bank, [he] ~ is liable to the true owner of the cheque for any loss he may sustain owing to the cheque having been so paid: Provided that if a cheque is presented for payment and it does not, at the time of presentment, appear to be crossed or to have had a crossing which has been obliterated, or to have a crossing which has been added to or altered, otherwise than as authorized by this Act, the [banker] bank paying the cheque in good faith and without negligence shall not be responsible or incur any liability, nor shall the payment be questioned, by reason of the cheque having been crossed, or of the crossing having been obliterated or having been added to or altered otherwise than as authorized by this Act, and of payment having been made to a person other than a [banker] bank or the [banker] bank to [whom] which the cheque is or was crossed, or the latter’s agent for collection [who] which is a (banker] bank, as the case may be.”. 5 10 15 20 25 30 35 Substitution of section 79 of Act 34 of 1964

Section 36Verify source

§ 37The following section is hereby substituted for section 79 of the principal Act:Substitution

Section 37 substitutes section 79 of the principal Act with a provision titled “Protection to bank and drawer where cheque is crossed”.

37. The following section is hereby substituted for section 79 of the principal Act: “Protection to bank and drawer where cheque is crossed

Section 37Verify source

§ 79If the [banker] bank on [whom] which a crossed cheque is drawn, inAmendment

A bank that pays a crossed cheque in good faith and without negligence gets the same protection as if it had paid the true owner.

79. If the [banker] bank on [whom] which a crossed cheque is drawn, in good faith and without negligence pays it, if crossed generally, to a [banker] Q, and, if crossed specially, to the [banker]&@ to [whom] which it is crossed, or the latter’s agent for collection, [who] which is a [banker] ~, the [banker] ~ paying the cheque, and, if the cheque has come into the hands of the payee, the drawer shall respectively be entitled to the same rights and be placed in the same position as if payment of the cheque had been made to the true owner thereof.”. 40 45 Amendment of section 81 of Act 34 of 1964

Section 79Verify source

§ 38Section 81 of the principaI Act is hereby amended—Substitution

Section 81 is amended by replacing subsections (1), (2), and (5). The new text lets a true owner recover a limited amount if a stolen or lost crossed cheque marked “not negotiable” was paid and the bank is not liable.

38. Section 81 of the principaI Act is hereby amended— (a) by the substitution for subsections (1) and (2) of tie following subsections: “(l) If a cheque was stolen or lost while it was crossed as authorized by this Act and while it bore on it the words ‘not negotiable’, and it was 50 20 so. 21846 G[l\’[lL\hlENT GAZETTE, 6 DECEMBER 2000 Ad k). 56. 2(KK) BIL1..S 01’ EXCHANGE Ah4ENDMENT ACT. 2000 paid b> the [banker] bank upon [whom] which it was drawn. under circumstances which do not render such [banker] bank liable in terms of this Act to the true owner of’the cheque for any loss he may sustain owing to the cheque ha!’ing been paid, the true owner shall, if he suffered any loss as a result of the theft or loss of the cheque, be entitled to recover from any person who was a possessor thereof after the theft or loss, and either gave a consideration therefor or took it as a donee, an amount equal to the true owner’s said loss or the amount of the cheque, whichever is the lesser. (2) If a person has after the theft or 10SS paid any such cheque into his account with a [banker] bank after having paid, or for the purpose of paying. the amount of the cheque or part thereof to the person from whom he received the cheque, or, on his direction, to any other person, he shall, foi the purposes of subsection (1), be deemed to have been a possessor of the cheque and to have given a consideration therefor: Provided that the foregoing provisions of this subsection shall not apply to a collecting [banker] bank employing, another [banker] bank as [his] & agent for the collection of any such cheque. ”; and (b) by the substitution for subsection (5) of the following subsection: “(5) For the purposes of subsection (1), a [banker who] bank which receives payment of any such cheque for a customer shall, subject to the provisions of subsection (3), not be regarded as having given a consideration therefor, merely because [he] it has in [his] its own books credited [his] & customer’s account with ~he amount o~ the cheque before receiving payment thereof, or because any such payment is applied towards the reduction or settlement of any debt owed by the customer to the [banker] bank.”. 5 10 15 20 25 Substitution of section 82 of Act 34 of 1964

Section 38Verify source

§ 39The following section is hereby substituted for section 82 of the principal Act:Substitution

This section substitutes a new rule applying sections 75 to 81 to certain documents other than cheques.

39. The following section is hereby substituted for section 82 of the principal Act: “Application of sections 75 to 81 to certain documents other than cheques 30

Section 39Verify source

§ 82Sections 75 to and including 81 shall also apply to any documentAmendment

This section makes sections 75 to 81 apply to certain payment documents as if they were cheques.

82. Sections 75 to and including 81 shall also apply to any document issued by a customer of any [banker] bank and intended to enable any person to obtain payment on demand of the sum mentioned in such document from such [banker] bank (or from any [banker] ~, if the document was issued on behalf of the State), and shall so apply as if the said document were a cheque, and the said sections shall mufatis nrukzndis also apply to any document which— (u) was issued on behalf of the State; (b) is drawn upon or addressed to a servant of the State (hereafter in this section called the drawee); and (c) is intended to enable any person to obtain payment on demand of the sum mentioned in such document from the drawee or from or through a [banker] ~, as if the said document were a cheque and as if the drawee were a [banker] bank and the State [his] its customer: Provided that nothing in this section contained shall render any such document a negotiable instrument.”. 35 40 45 Amendment of section 83 of Act 34 of 1964

Section 82Verify source

§ 40Section 83 of the principal Act is hereby amended—Substitution

Section 83 is amended so a bank acting in good faith and in the ordinary course of business is not liable merely because endorsement is missing or irregular when it credits or pays certain cheques, documents, or drafts.

40. Section 83 of the principal Act is hereby amended— (a) by the substitution for subsection (1) of the following subsection: 50 “(1) If a [banker] bank in good faith and in the ordinary course of business credits the account of [a] & customer [of his] with or pays to another [banker] bank the amount of–– (a) any chequc drawn on [him] ~; - .,, ‘2; .No. 21s46 Cio’V’E!?NMk NT G,4ZETTE. 6 DECEkfF3ER 2000 _ _ _ _ __ — — FIIL1.,S (3F EXC’HA.NGE AMENDMENT ACT. 2000 an!’ othel- document issued by [a] its customer [of his] and intended to enable any person to obtain p=yment on demand of the sum mentioned in such document from [him] ~ (or from any [banker] ~, if the document was issued on behalf of the State); or draft payable on demand drawn by such first-mentioned [banker] bank up&] [himselfl ~ or upon [his] its agent who is a [banker] bank, whether payable at the head office o~some other office of [his] its bank or of such agent, [he] ~shall not incur any liability by reason only of the absence of, or irregularity in, endorsement thereof, and such cheque, document or draft shall be discharged by such crediting of the account in question or by such payment.”; and (b) by the substitution for subsection (2) of the following subsection: “(2) The provisions of sub-section (1) shall murutis rnurandis also apply to any document which— (a) u’as issued on behalf of the State; (b) is drawn upon or addressed to a servant of the State (hereafter in this section called the drawee); and 5 10 15 (c) is intended to enable any person to obtain payment on demand of the sum mentioned in such document from the drawee or from or through a [banker] bank, 20 as if the said document were a cheque and as if the drawee were a [banker] bank and the State [his] & customer.”. Substitution of section 84 of Act 34 of 1964

Section 40Verify source

§ 41The following section is hereby substituted for section 84 of the principal Act:Substitution

A bank gets certain rights when a payable-to-order cheque or similar document is delivered for collection without proper indorsement, and it is treated as holder in pledge if the holder owes the bank money.

41. The following section is hereby substituted for section 84 of the principal Act: 25 “Rights of banks if unendorsed or irregularly indorsed cheques or certain other documents are delivered to them for collection 84. (1) If a cheque, or draft or other document referred to in section 83, which~payable to order, is delivered by the holder thereof to a [banker] bank for collection, and such cheque, draft or document is not indorsed or was irregularly indorsed by such holder, such [banker] bank shall have such rights, if any, as [he] ~ would have had if, upon such delivery, the holder had indorsed it in blank. (2) Where a cheque referred to in section 75A is delivered by the holder thereof to a bank for collection and the holder is indebted to the bank, the bank shall be deemed to be the holder thereof taking the cheque in pledge for such indebtedness with the same ri,~hts and subject to the same liabilities as the holder had.”. 30 35 Substitution of section S5 of Act 34 of 1964

Section 41Verify source

§ 42The following section is hereby substituted for section 85 of the principal Act:Substitution

This section replaces section 85 of the principal Act and gives the new heading “Evidential value of payment of unendorsed or irregularly indorsed cheques or certain other documents”.

42. The following section is hereby substituted for section 85 of the principal Act: 40 “Evidential value of payment of unendorsed or irregularly indorsed cheques or certain other documents

Section 42Verify source

§ 85If an unendorsed or irregularly indorsed cheque, or draft or otherAmendment

If a cheque, draft, or similar document covered by section 83 is paid by the bank on which it is drawn, that payment is prima facie evidence that the payee received the amount stated.

85. If an unendorsed or irregularly indorsed cheque, or draft or other document referred to in section 83, has been paid by the [banker] bank (including a drawee referred to in subsection (2) of the said section) on [whom] which it is drawn, such payment shall be Prima fucie evidence of the receipt by the payee of the sum mentioned in such cheque, draft or document.”. 45 Amendment of section 93 of Act 34 of 1964

Section 85Verify source

§ 43Section 93 of the principal Act is hereby amended by the substitution forSubstitution

This amendment says certain bill-related rules do not apply to notes.

43. Section 93 of the principal Act is hereby amended by the substitution for subsection (3) of the following subsection: 50 24 No. 21846 ——— GC)VERNMEN’T GAZF.TT%. 6 DECEMBER 2000” Act No. 56.2000 BILLS OF EXCHANGE AhlEN[)MEN”r ACT. 2000 “(3) T hefollowing provisions as to bills do not apply to notes, namely. the provisions relating to— (a) presentment for acceptance: (b) acceptance: and (c) [acceptance~r honour supra protest; (d)] bills in a set.”. Substitution of section 95 of Act 34 of 1964, as amended by section 6 of Act 77 of 1986

Section 43Verify source

§ 44The following section is hereby substituted for section 95 of the principal Act:Repeal

This section says a required signature does not have to be signed by hand; an authorized person may write or print it, and certain corporate seals, stamps, or computer-printed authorized names count as signing.

44. The following section is hereby substituted for section 95 of the principal Act: “Signature 5 10 95. [(1)] If by this Act, any instrument or writing is required to be signed by any person, it is not necessary that he should sign it with his own hand, but it is sufficient if his signature is written or printed thereon by some other person, by or under his authority, and the authorized sealing or stampin~ with a seal or stamp of a corporation shall be suficient and be deemed to be 15 [quivalent] equivalent to the signing or endorsement of any such instrument or writing. [(2) For the purpose of subsection (1) the printing by a computer of the name of an authorized signatory of a warrant-voucher or a Post Office cheque on a warrant-voucher or Post Office cheque shall be 20 sufficient, and shall be deemed to be the signing thereof.]”. Repeal of section 97 of Act 34 of 1964

Section 44Verify source

§ 45Section 97 of the principal Act is hereby repealed.Repeal

Section 97 of the principal Act is repealed.

45. Section 97 of the principal Act is hereby repealed. Amendment of section 98 of Act 34 of 1964

Section 45Verify source

§ 46Section 98 of the principal Act is hereby amended by the substitution for 25Short title

If a dishonoured bill or note must be protested but a notary is unavailable, a local landowner or householder may sign a certificate with two witnesses that serves as a formal protest.

46. Section 98 of the principal Act is hereby amended by the substitution for 25 subsection ( 1 ) of the following subsection: “(1 ) If a dishonored bill or note is authorized [or required] to be protested, and the services of a notary cannot be obtained at the place where the bill or note is dishonored, any landowner or householder of the place may, in the presence of two witnesses, give a certificate, signed by them, attesting the dishonour of the bill, 30 and such certificate shall in all respects operate as if it were a formal protest of the bill.”. Short title and commencement

Section 46Verify source

§ 47This Act is called the Bills of Exchange Amendment Act, 2000, and comes intoCommencement

This section says the Act is named the Bills of Exchange Amendment Act, 2000, and starts when the President sets a date by proclamation in the Gazette.

47. This Act is called the Bills of Exchange Amendment Act, 2000, and comes into operation on a date fixed by the President by proclamation in the Gazette, 35 *

Section 47Verify source

Legislative relationships

14 referenced instruments

Names are derived from the stored provision headings and citation-enrichment layer. Treat this as a research index and verify each relationship against the source text.

A–F

5 instruments

a new section 68 of the principal Act
Section 25
a new section 77 of the principal Act
Section 35
Bills of Exchange Act, 1964
Section 1
cheque-crossing rules in section 75. 32. Section 75 of the principal Act
Section 32
Exchange Amendment Act, 2000
Section 47

N–S

9 instruments

of section 13 of Act
Section 3
of section 23 of Act
Section 6
of section 64 of Act
Section 20
of section 65 of Act
Section 21
of section 74 of Act
Section 73
of section 97 of Act
Section 44
principal Act
Sections 11, 16, 19, 22, 26, 37
Public Accountants’ and Auditors’ Act, 1991
Section 72B
section 76 about how cheques may be crossed. 34. Section 76 of the principal Act
Section 34

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