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Abstract

The appeal decision of National Australia Bank Ltd v Hokit Pty Ltd raises significant points of law surrounding one of the most common of legal relationships, that of banker and customer. This paper considers the issues raised by Hokit's case, particularly the ambit of the implied contractual duties owed by a customer to a bank. Whilst previous Australian courts have considered customers’ duties in relation to the conduct of the customer's account and dealings with the bank, Hokit's case considered the extent of the duty in the wider context of the particular customer's business practices including, for example, whether a customer owed a duty to prevent irregular banking transactions. Accordingly this paper will first consider the facts of Hokit's case and the judgment of Giles CJ and then the decision of the New South Wales Court of Appeal's consideration of the matter, commenting on the various issues raised.

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