Question 219. - A municipal corporation issues a cheque payable to the order of "Good Roads Commission," and the cheque is marked "accepted" by the bankers of the municipality. The cheque was lost in the mails. The municipal corporation wish to issue a duplicate and ask the "Good Roads Commission" for a bond of indemnity, which is refused on the ground that the original cheque had not been received. Would it be sufficient for the municipality to give the bank accepting the cheque a "stop payment" of the lost cheque and then issue a duplicate? Could the bank properly ask for a bond of indemnity from the municipality before paying the duplicate if the duplicate is not to be charged to the municipality? Could the municipal corporation properly ask for a bond of indemnity from the "Good Roads Commission "that it would not negotiate the lost cheque?

Answer. - The bank through its certification of the first cheque having rendered itself liable to a holder in due course is entitled to require a bond of indemnity from the municipality before acting on a "stop payment" order or paying a duplicate. The question of whether the municipality is entitled to require bond of indemnity from the Good Roads Commission is a matter with the propriety of which the bank is not concerned, but we do not think in the circumstances the Commission could be required to give a bond.