TRADING WITH THE ENEMY WHETHER RENEWAL BY BANK OF ENEMY SUBJECTS' FIXED DEPOSITS CONSTITUTES ENTERING INTO FINANCIAL OBLIGATION FOR BENEFIT OF ENEMY
TRADING WITH THE ENEMY ACT 1914, s. 9B
The Acting Comptroller-General of Customs and Public Trustee has forwarded for advice the following memorandum:
The Bank of New South Wales has several fixed deposits in the names of enemy subjects, which have been returned on Form Fl in accordance with the terms of section 9B of the Trading with the Enemy Act 1914-1916.
As these deposits fell due, the Bank has renewed them automatically from time to time with interest added, returning such interest on Form Fl.
The Bank now asks to be advised whether it is considered a breach of the Trading with the Enemy Proclamations to renew such deposits, and I should be glad if the Secretary would kindly advise me in the matter.
Sub-paragraph (9) of paragraph 5 of the Imperial Proclamation of 9 September 1914 provides that no person resident, carrying on business, or being in the British Dominions shall enter into any commercial, financial, or other contract or obligation with or for the benefit of an enemy.
Halsbury, Vol. 1, p. 588 says:
The receipt of money on deposit account constitutes the banker a debtor to the depositor, but not a trustee thereof for him. The debt is repayable either on demand or on conditions usually expressed on the receipt. Specified notice may be stipulated for, and the return of the receipt made a condition of repayment, or the deposit may be for a fixed period. If the return of the deposit receipt be a condition precedent, no actual debt arises until its return.
The deposits under consideration are evidently deposits for fixed periods, at the termination of which the banker holds the deposits as debts due to the enemy subjects unless the deposits are renewed.
I presume that upon the termination of the original period of the fixed deposit the money is payable without further demand other than, perhaps, the production of the deposit receipt. The renewal of the deposit by the Bank, without any request by or arrangement with the enemy depositor, does, however, in my opinion amount to the entering into a financial obligation for the benefit of an enemy.
[Vol. 16, p. 245]