Publication Year: 1991
Published by: Hong Kong University Press, HKU
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General Editor's Foreword
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Times are changing for professional education as for all else in Hong Kong. The Hong Kong Society of Accountants has recognized the need to bring its educational demands home to Hong Kong and forward to the present day. All the law parts of the professional examinations now require the student to know the law in Hong Kong rather than England. Before the Society could...
Preface to the Second Edition
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This book is about cheques and some other banking instruments as they are used in Hong Kong, and the law which applies to them. It puts its emphasis on cheques and deals less thoroughly with bills of exchange, promissory notes and other instruments. Most law books start the other way round, dealing first with the law of bills of exchange and then with cheques as they...
Part One: Introduction
Chapter 1: The Background
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1.1 Economic Background 1.1.1 Money. The invention o f money marks a great advance i n the technology of trade. Money is something which has a standard value. It counts the same whatever it is exchanged for, whether that is wool or pigs, clothes or shelter, labour or personal services. Anything which people are prepared to pay for can be given a money value. Money can also be hoarded more efficiently than most other...
Chapter 2: Instruments and Negotiability
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2.1 Instruments In ordinary language the word 'instrument' has many meanings. Even as a technical legal term its meaning ranges from a tool used for housebreaking to a piece of subordinate legislation. Here, though, it simply means a written document, signed but not sealed, which shows who owns money; in legal language 'an instrument under hand which is a document of title to money' . Some instruments, such as warehouse...
Part Two: Cheques
Chapter 3: The Nature, Functions and Definition of a Cheque
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3.1 The Role of the Bank and the Contract with the Customer Individuals and companies open bank accounts of different kinds for different purposes. You may want to save regularly and decide that a savings account will give you acceptable interest while allowing you to withdraw freely as you need the money. You may prefer to get a higher rate of interest by giving up some of that freedom to withdraw for a period. You will then have a long-term deposit...
Chapter 4: Indorsements and Crossings
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4.1 Indorsements 'Indorse' means 'write on the back'. The word is more commonly spelled 'endorse' but the spelling of BOEO is preferred in this book to show that the word is being used not in its general sense but with the meaning it has in the context of negotiable instruments. A bearer cheque needs no indorsement. It is negotiated merely by delivery, that is transfer of possession. But an order cheque needs something...
Chapter 5: Parties, Holders and Defects
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5.1 Parties As previous chapters have shown, liability on a cheque can fall on the drawer, who draws it, or anyone who indorses it, the indorser. Remember that the whole point of a cheque is to represent money and to give to a person who is in rightful possession of it a right to that amount, without any reference to any transaction which gave rise to the debt. The cheque stands on its own as an independent...
Chapter 6: Forgeries, Alterations and Protection of Banks
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6.1 Forgeries 6.1.1 The general rule is that a forgery has n o effect Forgery is a crime: the making of a false document in order that it may be used as genuine with intent to defraud or deceive. A forged document is illegal and usually a nullity. But if there were no exceptions to that rule the usefulness of negotiable instruments would be greatly reduced. Some balance must be struck between the interests of all the...
Part Three: Bills of Exchange and Other Instruments
Chapter 7: Bills of Exchange
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7.1 Bills of Exchange in Hong Kong 7.1.1 Every day in Hong Kong, ordinary people, companies large and small, and the government draw between them about a quarter of a million cheques. Compared with that figure, the number of bills of exchange seems tiny, but that does not mean that bills of exchange are commercially unimportant. Moreover, few of the cheques are, or are intended to be, negotiated. Many of the bills are. This chapter...
Chapter 8: Promissory Notes and Other Instruments
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8.1 Instruments other than Cheques and Bills 8.1.1 Though this book i s about cheques, the most important of banking instruments, it was necessary to discuss in Chapter 7 the special characteristics of bills of exchange. There are also instruments besides cheques and bills which, though of less importance, need to be understood; and there are modem devices which, though not instruments at all, are so popular that they are likely to supplant cheques...
Bibliography of Further Reading
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Table of Statutes
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Table of Cases
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Glossary and Index
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Page Count: 120
Publication Year: 1991