Commonwealth Consolidated Acts

[Index] [Table] [Search] [Search this Act] [Notes] [Noteup] [Download] [Help]

CHEQUES ACT 1986 - NOTES

No. 145, 1986

Compilation No. 13

Compilation date:   1 March 2017

Includes amendments up to: Act No. 61, 2016

Registered:    7 March 2017

 

 

 

 

 

 

 

 

 

This compilation includes a commenced amendment made by Act No. 11, 2016

 

About this compilation

This compilation

This is a compilation of the Cheques Act 1986 that shows the text of the law as amended and in force on 1 March 2017 (the compilation date).

The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law.

Uncommenced amendments

The effect of uncommenced amendments is not shown in the text of the compiled law. Any uncommenced amendments affecting the law are accessible on the Legislation Register (www.legislation.gov.au). The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. For more information on any uncommenced amendments, see the series page on the Legislation Register for the compiled law.

Application, saving and transitional provisions for provisions and amendments

If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes.

Editorial changes

For more information about any editorial changes made in this compilation, see the endnotes.

Modifications

If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. For more information on any modifications, see the series page on the Legislation Register for the compiled law.

Self-repealing provisions

If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.

 

 

 

Contents

Part I--Preliminary

1 Short title

2 Commencement

3 Interpretation

4 Application of rules in bankruptcy, laws of States and Territories and rules of the common law

5 Cheques a financial institution draws on itself

6 Certain rights, duties and liabilities under Act may be altered by agreement

7 Application of Act

8 Extension of Act to external Territories

9 Act binds the Crown

Part II--Cheques

Division 1--Form

10 Cheque defined

11 Order to pay

12 Unconditional order to pay

13 Order addressed to a financial institution

14 Order to pay on demand

15 Order to pay a sum certain

16 Date of cheque etc.

17 Optional stipulations

18 Inchoate instruments

Division 2--Order and bearer cheques

19 Meaning of specification of person in cheque as payee or indorsee

20 Cheques either payable to order or to bearer

21 Cheques payable to order

22 Cheques payable to bearer

23 Conversion of cheque payable to bearer into cheque payable to order

24 Cheques payable to order of specified person

Division 3--Delivery

25 Delivery essential for drawing or indorsement

26 Requisites for effective delivery

27 Drawing or indorsement may be shown to be ineffective

28 Presumption of effective delivery

29 Delivery of cheque payable to bearer

Division 4--Capacity

30 Capacity to incur liability on cheque

Division 5--Signature

31 Signature essential to liability on cheque

32 Unauthorised signature

33 Person signing as agent or in representative capacity

34 Procuration signature

Division 6--Consideration

35 Valuable consideration defined

36 Presumption of value

37 Holder taking cheque for which value has been given

38 Holder having lien

Part III--Negotiability of cheques

Division 1--Transfer by negotiation

39 Every cheque transferable by negotiation

40 Transfer of cheque by negotiation

41 Requisites for indorsement

42 Transfer of order cheque without indorsement

43 Indorsement of order cheque payable jointly to 2 or more persons

44 Indorsement where payee or indorsee misdescribed

45 Conditional indorsement

46 Transfer of stale or dishonoured cheque by negotiation

47 Transfer by negotiation back to drawer or indorser

48 Order of indorsements

49 Rights acquired by transfer by negotiation

Division 2--Holder in due course

50 Holder in due course defined

51 Presumption that holder is holder in due course

52 Holder deriving title through holder in due course

Division 3--Crossings

53 Crossing and crossed cheque defined

54 Effect of crossing on payment of cheque

55 Effect of taking cheque crossed not negotiable

56 Persons who may add crossing to cheque

57 Multiple crossings

Part IV--Presentment and dishonour

Division 1--Presentment

58 Drawer and indorsers of cheque not liable unless cheque presented

59 When presentment dispensed with

60 Effect of failure to present within reasonable time

61 Due presentment defined

61A Presentment by financial institution

62 External presentment by financial institution

62A Internal presentment by drawee institution

63 Presentment by person other than financial institution

64 Proper place

65 External presentment of cheques by financial institutions--designated places and designated exhibition places

65A Internal presentment of cheques by financial institutions--notified places

66 Deposit institution to present cheques promptly

67 Drawee institution to pay or dishonour promptly

68 How paid cheque to be dealt with

Division 2--Dishonour

69 Dishonour defined

70 Drawer and indorsers of cheque liable whether or not given notice of dishonour

Division 3--Turnback of cheques drawn on failed financial institutions

70A Certain cheques taken to be dishonoured

70B Consequences of cheque being taken to be dishonoured

Part V--Liabilities on cheques

Division 1--Liabilities of parties

71 Liability of drawer

72 Estoppel against drawer

73 Liability of indorser

74 Estoppels against indorser

75 Stranger signing cheque liable as indorser

76 Measure of damages on dishonour

77 Transferor by delivery

Division 2--Discharge of liabilities of parties

78 When cheque discharged

79 Payment in due course

80 Renunciation of rights against drawer or all persons liable on cheque

81 Cancellation of cheque or drawer's signature

82 Effect of discharge of cheque

83 When indorser discharged

84 Renunciation of rights against indorser

85 Cancellation of indorser's signature

86 Effect of discharge of indorser

87 Effect of payment by drawer or indorser

Part VI--Duties and liabilities of financial institutions

Division 1--The drawee institution

88 Cheque not assignment of funds

89 Stale cheque

90 Countermand of payment and notice of death or mental incapacity

91 Protection of drawee institution paying improperly raised cheque

92 Protection of drawee institution paying crossed cheque in accordance with crossing

93 Payment of crossed cheque otherwise than in accordance with crossing

94 Protection of drawee institution paying cheque lacking indorsement or with irregular or unauthorised indorsement

Division 2--The collecting institution

95 Protection of institution collecting cheque for customer or another institution

96 Rights of institution collecting order cheque not indorsed by payee

Part VII--Special provisions relating to FCA institutions and agency cheques

Division 1--Presentment and collection of cheques by FCA institutions

97 FCA institution to ensure cheques presented promptly

98 Protection of FCA financial institution collecting cheque for customer

99 Rights of FCA financial institution collecting order cheque not indorsed by payee

Division 2--Agency cheques

100 Agency cheques

100A Unauthorised signature

Part IX--Miscellaneous

113 Payment of unindorsed order cheque as evidence of receipt by payee

114 Signature

115 Replacement of lost or destroyed cheque

116 Action on lost or destroyed cheque

117 Conflict of laws

118 Dividend warrants

119 Regulations

Endnotes

Endnote 1--About the endnotes

Endnote 2--Abbreviation key

Endnote 3--Legislation history

Endnote 4--Amendment history

 

Endnotes

Endnote 1--About the endnotes

The endnotes provide information about this compilation and the compiled law.

The following endnotes are included in every compilation:

Endnote 1--About the endnotes

Endnote 2--Abbreviation key

Endnote 3--Legislation history

Endnote 4--Amendment history

Abbreviation key--Endnote 2

The abbreviation key sets out abbreviations that may be used in the endnotes.

Legislation history and amendment history--Endnotes 3 and 4

Amending laws are annotated in the legislation history and amendment history.

The legislation history in endnote 3 provides information about each law that has amended (or will amend) the compiled law. The information includes commencement details for amending laws and details of any application, saving or transitional provisions that are not included in this compilation.

The amendment history in endnote 4 provides information about amendments at the provision (generally section or equivalent) level. It also includes information about any provision of the compiled law that has been repealed in accordance with a provision of the law.

Editorial changes

The Legislation Act 2003 authorises First Parliamentary Counsel to make editorial and presentational changes to a compiled law in preparing a compilation of the law for registration. The changes must not change the effect of the law. Editorial changes take effect from the compilation registration date.

If the compilation includes editorial changes, the endnotes include a brief outline of the changes in general terms. Full details of any changes can be obtained from the Office of Parliamentary Counsel.

Misdescribed amendments

A misdescribed amendment is an amendment that does not accurately describe the amendment to be made. If, despite the misdescription, the amendment can be given effect as intended, the amendment is incorporated into the compiled law and the abbreviation "(md)" added to the details of the amendment included in the amendment history.

If a misdescribed amendment cannot be given effect as intended, the abbreviation "(md not incorp)" is added to the details of the amendment included in the amendment history.

 

Endnote 2--Abbreviation key

 

ad = added or inserted

o = order(s)

am = amended

Ord = Ordinance

amdt = amendment

orig = original

c = clause(s)

par = paragraph(s)/subparagraph(s)

C[x] = Compilation No. x

    /sub-subparagraph(s)

Ch = Chapter(s)

pres = present

def = definition(s)

prev = previous

Dict = Dictionary

(prev ... ) = previously

disallowed = disallowed by Parliament

Pt = Part(s)

Div = Division(s)

r = regulation(s)/rule(s)

ed = editorial change

reloc = relocated

exp = expires/expired or ceases/ceased to have

renum = renumbered

    effect

rep = repealed

F = Federal Register of Legislation

rs = repealed and substituted

gaz = gazette

s = section(s)/subsection(s)

LA = Legislation Act 2003

Sch = Schedule(s)

LIA = Legislative Instruments Act 2003

Sdiv = Subdivision(s)

(md) = misdescribed amendment can be given

SLI = Select Legislative Instrument

    effect

SR = Statutory Rules

(md not incorp) = misdescribed amendment

Sub-Ch = Sub-Chapter(s)

    cannot be given effect

SubPt = Subpart(s)

mod = modified/modification

underlining = whole or part not

No. = Number(s)

    commenced or to be commenced

 

Endnote 3--Legislation history

 

Act

Number and year

Assent

Commencement

Application, saving and transitional provisions

Cheques and Payment Orders Act 1986

145, 1986

11 Dec 1986

1 July 1987 (gaz 1987, No. S131)

 

Proceeds of Crime (Miscellaneous Amendments) Act 1987

73, 1987

5 June 1987

5 June 1987 (s 2)

--

Statute Law (Miscellaneous Provisions) Act 1987

141, 1987

18 Dec 1987

s 3: 18 Dec 1987 (s 2(1))

s 5(1)

Law and Justice Legislation Amendment Act 1994

84, 1994

23 June 1994

Part 4 (s 9-34): 16 Dec 1994 (s 2(3) and gaz 1994, No. S435)

s 10, 21-23, 33 and 34

Statute Law Revision Act 1996

43, 1996

25 Oct 1996

Sch 2 (item 22): 5 June 1987 (s 2(2))

--

Financial Sector Reform (Consequential Amendments) Act 1998

48, 1998

29 June 1998

Sch 1 (item 26): 1 July 1998 (s 2(2) and gaz 1998, No. S316)

--

Cheques and Payment Orders Amendment Act 1998

76, 1998

2 July 1998

Sch 1 (items 1-26, 28-69, 83-133), Sch 2 and 3: 1 Dec 1998 (gaz 1998, S371)
Sch 1 (items 27, 70-78, 81, 82): 1 Dec 1998
Remainder: Royal Assent

Sch 1 (items 131-133) and Sch. 2 (items 6, 11, 31)

Cheques and Payment Orders Amendment (Turnback of Cheques) Act 1998

77, 1998

2 July 1998

Sch 1 : 22 July 1998 (s 2)

--

Financial Sector Reform (Amendments and Transitional Provisions) Act (No. 1) 1999

44, 1999

17 June 1999

Sch 7 (items 5-14) and Sch 8 (items 22, 23): 1  July 1999 (s 2(2), (16))

Sch 8 (items 22, 23)

Corporations (Repeals, Consequentials and Transitionals) Act 2001

55, 2001

28 June 2001

s 4-14 and Sch 3 (item 97): 15 July 2001 (s 2(3))

s 4-14

Financial Sector (Collection of Data--Consequential and Transitional Provisions) Act 2001

121, 2001

24 Sept 2001

Sch 2 (item 149): 1 July 2002 (s 2(2))

--

Financial Sector Legislation Amendment (Simplifying Regulation and Review) Act 2007

154, 2007

24 Sept 2007

Sch 4 (items 10, 11): 24 Sept 2007 (s 2(1) item  7)

Sch 4 (item 11)

Statute Law Revision Act (No. 2) 2015

145, 2015

12 Nov 2015

Sch 3 (item 9): 10 Dec 2015 (s 2(1) item 7)

--

Statute Law Revision Act (No. 1) 2016

4, 2016

11 Feb 2016

Sch 4 (items 1, 47): 10 Mar 2016 (s 2(1) item 6)

--

Insolvency Law Reform Act 2016

11, 2016

29 Feb 2016

Sch 2 (item 42): 1 Mar 2017 (s 2(1) item 3)

--

Statute Update Act 2016

61, 2016

23 Sept 2016

Sch 1 (item 78): 21 Oct 2016 (s 2(1) item 1)

--

 

Endnote 4--Amendment history

 

Provision affected

How affected

Part I

 

s. 1.....................

am. No. 76, 1998

s. 3.....................

am. Nos. 48 and 76, 1998; No. 44, 1999; No. 121, 2001

s. 4.....................

am. No. 76, 1998

s. 5.....................

am. No. 84, 1994

 

rs. No. 76, 1998

s. 6.....................

am. No. 84, 1994

s 9.....................

rs No 145, 2015

Part II

 

Division 1

 

s. 10....................

am. No. 76, 1998

s. 12....................

am. No. 76, 1998

s. 13....................

am. No. 76, 1998

s. 17....................

am. No. 76, 1998

Division 2

 

ss. 21-23.................

am. No. 76, 1998

Division 5

 

s. 32....................

am. No. 141, 1987

Part III

 

Division 1

 

ss. 43, 44.................

am. No. 76, 1998

s. 49....................

am. No. 76, 1998

Division 3

 

s. 54....................

am. No. 76, 1998

Part IV

 

Division 1

 

s. 59....................

am. Nos. 76 and 77, 1998

s. 60....................

am. No. 76, 1998

s. 61....................

am. No. 84, 1994; No. 76, 1998

s. 61A...................

ad. No. 84, 1994

 

am. No. 76, 1998

s. 62....................

am. No. 84, 1994; No. 76, 1998

s. 62A...................

ad. No. 84, 1994

 

am. No. 76, 1998

s. 63....................

am. No. 76, 1998

s. 64....................

am. No. 76, 1998

s. 65....................

am. No. 84, 1994; No. 76, 1998

s. 65A...................

ad. No. 84, 1994

 

am. No. 76, 1998

s. 66....................

am. No. 84, 1994; Nos. 76 and 77, 1998

s. 67....................

am. No. 84, 1994; No. 76, 1998

s. 68....................

am. No. 73, 1987; No. 43, 1996; No. 76, 1998; No. 44, 1999 ; No 4, 2016; No 61, 2016

Division 2

 

s. 69....................

am. No. 76, 1998; No. 77, 1998

Division 3

 

Division 3 heading..........

rs. No. 76, 1998

Division 3................

ad. No. 77, 1998

s. 70A...................

ad. No. 77, 1998

 

am. Nos. 76 and 77, 1998; No. 55, 2001; No. 154, 2007; No 11, 2016

s. 70B...................

ad. No. 77, 1998

 

am. No. 76, 1998

Part V

 

Division 1

 

s. 71....................

am. No. 77, 1998

s. 73....................

am. No. 77, 1998

Division 2

 

s. 78....................

am. No. 76, 1998

s. 87....................

am. No. 76, 1998

Part VI

 

Part VI heading.............

rs. No. 76, 1998

Division 1

 

Division 1 heading..........

rs. No. 76, 1998

ss. 88-90.................

am. No. 76, 1998

s. 91....................

am. No. 76, 1998

s. 92....................

rs. No. 76, 1998

s. 93....................

am. No. 76, 1998

s. 94....................

am. No. 76, 1998

Division 2

 

Division 2 heading..........

rs. No. 76, 1998

s. 95....................

am. No. 141, 1987; No. 76, 1998

s. 96....................

am. No. 76, 1998

Part VII

 

Part VII heading............

rs. No. 76, 1998; No. 44, 1999

Division 1

 

Division 1 heading..........

rs. No. 76, 1998

s. 97....................

am. Nos. 76 and 77, 1998

s. 98....................

am. No. 76, 1998

s. 99....................

am. No. 76, 1998

Division 2

 

s. 100...................

am. No. 76, 1998; No. 44, 1999

s. 100A..................

ad. No. 76, 1998

Part VIII.................

rep. No. 76, 1998

ss. 101-104...............

rep. No. 76, 1998

s. 105...................

am. No. 84, 1994

 

rep. No. 76, 1998

s. 105A..................

ad. No. 84, 1994

 

rep. No. 76, 1998

s. 106...................

am. No. 84, 1994

 

rep. No. 76, 1998

s. 106A..................

ad. No. 84, 1994

 

rep. No. 76, 1998

ss. 107, 108...............

rep. No. 76, 1998

s. 109...................

am. No. 84, 1994

 

rep. No. 76, 1998

s. 109A..................

ad. No. 84, 1994

 

rep. No. 76, 1998

s. 110...................

am. No. 141, 1987; No. 84, 1994

 

rep. No. 76, 1998

s. 111...................

am. No. 84, 1994

 

rep. No. 76, 1998

s. 112...................

am. No. 73, 1987

 

rep. No. 76, 1998

Part IX

 

s. 113...................

am. No. 76, 1998

s. 114...................

rs. No. 76, 1998

 

am. No. 44, 1999

s. 115...................

am. No. 141, 1987

s. 117...................

am. No. 76, 1998

Schedule.................

am. No. 141, 1987; No. 84, 1994

 

rep. No. 76, 1998

 


AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback