Ruling on Scotiabank cheque-cashing fee case set for October 1

October 1 has been set as the date for a ruling on the lawsuit filed by Member of Parliament (MP) Fitz Jackson against financial giant Scotiabank in the Supreme Court over the fee applied to encashing a cheque.

Lawyers representing the legislator and Scotiabank on Wednesday made submissions before Justice Cresencia Brown Beckford who is expected to later this year communicate whether the case will go to trial or award judgement in favour of Jackson.

The Bank of Jamaica (BOJ) and Jamaica's attorney general (AG) have been included in the matter as interested parties.

Jackson, the parliamentary representative for St Catherine Southern, is seeking a declaration from the court that Scotiabank, through the imposition of the fee, has breached its obligation by failing to honour a negotiable instrument.

Section 73 of the Bills of Exchange Act defines a cheque as a negotiable instrument and stipulates that it must be honoured on demand without conditions, his lawyers Anthony Williams and Annette Henry have argued.

On Wednesday, the duo argued to prevent the matter from going to trial and to have Justice Brown Beckford rule in favour of their client that Scotiabank had no legal authority to impose a fee for encashing a cheque.

Such a ruling would set a precedent for how other banks operate.

Both Williams and Henry argued that the commercial bank, through its attorney Maurice Manning of Nunes, Scholefield, DeLeon & Co, submitted arguments that they did not plead.

The Gleaner was informed that during the matter, which is in chamber, Manning raised new points that were not initially submitted in court documents.

Manning reportedly argued that Jackson did not properly present the cheque to the bank because he did not take the cheque to the bank's Half Way Tree branch but to its Portmore branch.

However, Jackson's legal team rejected this as “nonsense”, arguing that Scotiabank is a centrally operated institution which chooses to have branches islandwide for its and customers' convenience.

Further, the bank argued that the cheque was not honoured when Jackson protested payment of the fee, but his team rebutted that the cheque was honoured because the bank took Jackson's money and sent him on his way.

Jackson's lawyers argued to have the new submissions denied but were unsuccessful in their bid.

Both the BOJ and AG Chambers reportedly supported the bank's position, noting that the submissions were legal arguments and ought to be admitted.

But the main issue at hand is that Scotiabank has argued that there is a custom and practice among banks to charge the cheque encashment fee.

Jackson's lawyers are contending that this practice is “unlawful” because the BOJ's governor does not have the power to pass laws or regulations and that a code issued by the central bank which allows the charging of banking fees does not supersede legislation.

They insist that the code cannot override the Bill of Exchange Act which stipulates that a cheque is an unconditional order directed by one person to another to pay a certain sum in money.

The lawyers said if that was not the intent of the legislature it would make the Bill of Exchange a “total mockery”.

Justice Brown Beckford is to make a ruling on this in the coming months after the mediation that was ordered by the court to determine if the two parties could settle the dispute instead of going to trial, failed in June last year.

The opposition MP initially filed the lawsuit in July 2022, after a May 2019 incident in which he, a seven-term lawmaker, claimed he was compelled to pay a $385 fee before a teller at Scotiabank's Portmore branch would cash a $2,500 cheque in his name.

- Kimone Francis

Follow The Gleaner on X and Instagram @JamaicaGleaner and on Facebook @GleanerJamaica. Send us a message on WhatsApp at 1-876-499-0169 or email us at onlinefeedback@gleanerjm.com or editors@gleanerjm.com.