Commissioner of Taxation v. English Scottish and Australian Bank

Facts

• A question arose regarding who qualifies as a "customer" for the purposes of statutory protection available to collecting bankers
• The older view required habitual and prolonged dealings before a person attained "customer" status
• The bank argued that opening an account suffices to establish the relationship

Issue

1. Who qualifies as a "customer" of a bank for purposes of statutory protection and the banker-customer relationship?

Held

• Lord Dunedin held that the word "customer" signifies a relationship in which duration is not essential. A person becomes a customer when the bank accepts the person's money for deposit into an account. The essence is the account relationship, not the length or frequency of dealings.

Ratio Decidendi

A customer is any person who has an account with the bank. The relationship commences upon opening an account. Habitual or long-standing dealings are not required. Even a single transaction suffices if an account is opened.