JUDGMENTBY: BAHAGIAR J, NEAL J

BAHAGIAR J In this case there is the following agreed statement of facts :

The plaintiff is a statutory corporation constituted by The Rubber Industry (Replanting) Fund Ordinance, 1952 and has its offices at Mercantile Bank Chambers, Kuala Lumpur. The defendant is a limited company incorporated in the Federation of Malaya carrying on the business of bankers at several towns in the Federation and has its principal branch and place of business at 9 Foch Avenue, Kuala Lumpur.

In July 1954 a firm known as "Kok Ann Rubber Estate" was entitled to payment of a sum of $ 14,730.89 from Fund "A" cess. In consequence the plaintiff drew a cheque for the sum of $ 14,730.89 in favour of Kok Ann Rubber Estate on its Fund "A" cess account with the Kuala Lumpur branch of the Chartered Bank of India, Australia and China. The said cheque was signed by the late Mr. Yong Shook Lin as a member of the Board and also by Messrs. Peat, Marwick, Mitchell & Co. the Secretaries and Treasurers of the Board. This latter signature was made by Mr. Villiers a partner in the firm. The cheque was stamped with a rubber stamp crossed "Account payee only" and was dated 9th July 1954.

In the normal course of business the said cheque was dispatched by Messrs. Peat, Marwick, Mitchell & Co. the Secretaries and Treasurers on the 9th July, 1954. In a manner known neither to the plaintiff nor the defendant the said cheque was misappropriated and came into the unauthorized possession of one Lee Man Choi.

The said Lee Man Choi visited the Kuala Lumpur branch of the Defendant Bank on the 13th July 1954 and produced the cheque payable to Kok Ann Rubber Estate his identity card and the duplicate original of Form A under the Buisness Registration Ordinance. The duplicate original of Form A showed that the particulars had been registered pursuant to the Business Registration Ordinance and bore the official stamp of the Registrar of Businesses. It was attested by an Advocate and Solicitor and showed that Lee Man Choi of 69, Murray Street, Seremban was the sole Proprietor of Kok Ann Rubber Estate. The same Seremban address was also on the identity card. An official at the Bank after examination of these documents opened an account in the name of Kok Ann Rubber Estate in the usual way. The person who so opened the account was unknown to the Bank prior to the date on which the account was opened. The licence number of the form which was produced was No. 46534 and subsequent investigations at the Business Registry disclosed that that licence number referred to a firm of tin miners known as the Ban Hin Kongsi No. 2 Mine with a principal place of business at Batu Puteh, Kampar.

The account having been opened with the said cheque of $ 14,730.89 a cheque for $ 10,000 was paid on July 14th, a further for $ 4,700 on July 16th and yet another cheque for $ 150 on July 30th. The balance remaining $ 80.89 still stands to the credit of that account.

In August 1954 the Kok Ann Rubber Co. enquired of the Secretaries to the plaintiff when they would receive their refund of cess. The Secretaries and Treasurers ascertained that the cheque had been paid by the Chartered Bank on the 14th July 1954 and informed the Kok Ann Rubber Company accordingly. The latter Company replied that they had not received the cheque and the Secretaries ascertained from the Chartered Bank that payment had been collected through the Kuala Lumpur Branch of the Oriental Bank of Malaya Limited. The Kok Ann Rubber Company was so informed and stated that the estate did not operate an account with the Oriental Bank. A representative of the Secretaries then visited the Oriental Bank saw the manager of the Bank and was informed of the details of the opening of the account as set out above.

One witness, R. V. Pillai, the Chief Clerk of the defendant Bank was called as a witness for the defence. From the evidence of this witness I find established the following facts:

In July 1954 a Chinese,

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