Bank Documentation - The Standard Terms Governing Current Accounts in Singapore: The Customer's Duty of Care, the Unauthorised Debit and the Allocation of Risk

Abstract

The modern banking environment no longer resembles the circumstances pertaining when the major banking law precedents were set. The Macmillan and Greenwood duties do not adequately protect banks from the unauthorized debit. Different remedies for the allocation of loss have been proposed, such as the extension of the principles of contributory negligence and a statutory allocation of loss. Banks, for their part, contract in their standard terms and conditions for more protection than is otherwise available to them. The verification and conclusive evidence clause is the bank's main protection, coupled with widespread exclusions of liability and indemnities. Use of the verification clause is supported but it needs to be tempered. A more balanced allocation is called for.