CHEQUES ACT 1986 - NOTES
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If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.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
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.
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) |
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 |
145, 1986 | 11 Dec 1986 | 1 July 1987 (gaz 1987, No. S131) |
| |
73, 1987 | 5 June 1987 | 5 June 1987 (s 2) | -- | |
141, 1987 | 18 Dec 1987 | s 5(1) | ||
84, 1994 | 23 June 1994 | Part 4 (s 9-34): 16 Dec 1994 (s 2(3) and gaz 1994, No. S435) | ||
43, 1996 | 25 Oct 1996 | Sch 2 (item 22): 5 June 1987 (s 2(2)) | -- | |
48, 1998 | 29 June 1998 | Sch 1 (item 26): 1 July 1998 (s 2(2) and gaz 1998, No. S316) | -- | |
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 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 | ||
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) | -- |
11, 2016 | 29 Feb 2016 | Sch 2 (item 42): 1 Mar 2017 (s 2(1) item 3) | -- | |
61, 2016 | 23 Sept 2016 | Sch 1 (item 78): 21 Oct 2016 (s 2(1) item 1) | -- |
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 |
|
am. No. 76, 1998 | |
Division 5 |
|
s. 32.................... | am. No. 141, 1987 |
Part III |
|
Division 1 |
|
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 |
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 |