Court sides with Scotiabank in cheque cashing fee case filed by Fitz Jackson

A high court judge has found that the Bank of Nova Scotia did not commit a breach in its practise to charge a fee to encash a cheque.

Opposition Member of Parliament Fitz Jackson had filed a claim against the bank seeking a declaration that Scotiabank, through the imposition of the fee, has breached its obligation by failing to honour a negotiable instrument.

Jackson contended that 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.

However, Justice Crescentia Brown Beckford, in a summary judgment handed down today in chambers, ruled that the bank's practise was not in breach of the Bills of Exchange Act or the Banking Services Act.

The judge also found that the bank's right to charge a fee for the service in question is subject to the obligations set by the code of conduct under the Banking Services Act.

Headlines Delivered to Your Inbox

Sign up for The Gleaner’s morning and evening newsletters.

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.

His lawyers, Anthony Williams and Annette Henry, argued 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 that allows banking fees does not supersede legislation.

But Scotia had countered that banks have a custom and practice to charge the cheque encashment fee.

King's Counsel Maurice Manning represented Scotia.

-  Tanesha Mundle