Banking: LESSON 10 BANK CUSTOMER RELATIONSHIP: CONCEPT AND CASES
This handout includes: Banker, Customer, Relationship, Customers, Act which is given below: "Pledge," "pawnor," and "pawnee" defined. Bailee - Pawnee Relationship between Banker and Customer Related Topics. Bank, Banker, Banking, Banking Company · Customer of the Bank · Agent. The Bailee is called the “Pawnee”. In case of Lallan Prasad v. Rahmat Ali[ii], Supreme Court of India defined Pledge as: “Pawn or pledge is a.
In the event of arising any cause of action, the customer is required to approach the branch with which it had opened account and not with any other branch.
Banking is a trust-based relationship. There are numerous kinds of relationship between the bank and the customer.
The relationship between a banker and a customer depends on the type of transaction. Thus the relationship is based on contract, and on certain terms and conditions. These relationships confer certain rights and obligations both on the part of the banker and on the customer.
Article Storm: Pledger and Pledgee Relationship
However, the personal relationship between the bank and its customers is the long lasting relationship. Some banks even say that they have generation-to-generation banking relationship with their customers. The banker customer relationship is fiducial relationship. The terms and conditions governing the relationship is not be leaked by the banker to a third party. The relationship between a bank and its customers can be broadly categorized in to General Relationship and Special Relationship.Contract of Pledge Pawnor & Pawnee in urdu hindi
Thus the relationship arising out of these two main activities are known as General Relationship. In addition to these two activities banks also undertake other activities mentioned in Sec. Relationship arising out of the activities mentioned in Sec.
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When a 'customer' opens an account with a bank, he fills in and signs the account opening form. When customer deposits money in his account the bank becomes a debtor of the customer and customer a creditor. The bank is not bound to inform the depositor the manner of utilization of funds deposited by him.
Bank does not give any security to the depositor i. The bank has borrowed money and it is only when the depositor demands, banker pays. Banker does not pay money on its own, as banker is not required to repay the debt voluntarily.
The demand is to be made at the branch where the account exists and in a proper manner and during working days and working hours.
Difference Between Bailment and Pledge (with Examples and Comparison Chart) - Key Differences
The debtor has to follow the terms and conditions of bank said to have been mentioned in the account opening form. In fact the terms and conditions are mentioned in the passbook, which is issued to the customer only after the account has been opened. This practice has since been discontinued. For convenience and information of prospective customers a few banks have uploaded the account opening form, terms and conditions for opening account, rate charge in respect of various services provided by the bank etc.
Lending money is the most important activities of a bank. The resources mobilized by banks are utilized for lending operations. Customer who borrows money from bank owns money to the bank. Babu Ram [xxiv]before the Allahabad High Court: One of the terms of an agreement of loan enabled the lending banker to sell the securities without any notice to the pawner. The pawner defaulted in the payment.
The bank sent a reminder, but the pawner asked for more time. The bank thereupon disposed of the securities. The sale was held to be bad in law. The sale must be for the benefit of both the parties. If there arises dispute regarding the quality of the goods, the pawnee cannot proceed in the matter without referring to the pawnor.
In such a situation, pawnee is the agent of the pawnor. Where goods are lost due to the negligence of the pledgee, the liability of the pledger is reduced to the extent of the value of such goods which are lost.
Difference Between Bailment and Pledge
In a case of Gurbax Rai v. Punjab National Bank [xxix]before the Supreme Court: Certain goods in the go down of a firm were under the pledge of a bank. The go down was insured against fire. A part of them was damaged by fire. The bank received insurance money to the extent of the fire.
Bailee - Pawnee Relationship between Banker and Customer
A hypothecatee is not in actual possession of the goods. He grants the right of use to the borrower. He naturally has a right to take possession of the goods if the borrower makes default.
He can then sell them in his capacity as a pledgee. Intervention of the court is not necessary. This provision is supplementary to the earlier section. Even after the time for payment of the debt or the performance of the promise has expired, the pawnor is entitled to redeem the goods pledged until they are actually sold; but he must then also pay any expenses which arise from his default.
State of Bombay [xxxi]that: It is open to the pledger to redeem the pledge by full payment of the amount for which the pledge had been made at any time if there is no period fixed for redemption, or at any time after the fixed date and the right continues until the thing pledged is lawfully sold.
A suit for redemption has to be filed for exercising this specific remedy and not just for a declaration of the right of redemption. Certain gold ornaments were pledged with a bank as a security for a gold loan. His wife sought to redeem the pledge by repaying the loan. The court said that she was entitled to redeem.
The bank could not ask her for submitting a probate of the will or a succession certificate. Her son and daughter raised no objection. Parties The person who delivers the goods is known as the Bailor while the person to whom the goods are delivered is known as Bailee.
The person who delivers the goods is known as Pawnor while the person to whom the goods are delivered is known as Pawnee.
Consideration May or may not be present. Right to sell the goods The party whom goods are being delivered has no right to sell the goods. The party whom goods are being delivered as security has the right to sell the goods if the party who delivers the goods fails to pay the debt.
Use of Goods The party whom goods are being delivered can use the goods only, for the specified purpose. The party whom goods are being delivered has no right to use the goods. Purpose Safe keeping or repairs, etc. As security against payment of debt. Definition of Bailment A contract in which the goods are handed over by one party to another party for a specific reason, which is expressed or implied for a short period. The person who delivers the goods is termed as bailor whereas the receiver of the goods is termed as bailee.
When the purpose of delivering the goods is accomplished, the bailee should return the goods to its actual owner. Here the word goods may include all the movable items, but property and money do not come under the definition of goods. While the transfer of goods the ownership of goods remain with the bailor only the possession of goods transfers for a limited period.
The receiver of the goods should take good care of the goods as he takes care of his own goods as well as he should not use the goods without the permission of its owner except for the purpose specified.