Question
of the week Question of the week

Curious. Interesting. Informative.

11 December 2015

All debts are off

Sale, Purchase, Mortgage, Lease
New South Wales

Asked

A body corporate gives a customer an option to pay in cash at the post office:

1. When is the payment deemed to be paid if it is paid in cash?

2. If a payment due date falls on a public holiday, is the due date the next business banking day?

3. Is Biller pay or BPAY regarded as electronic banking?

4. Suppose a bill is due on 1st October being a public holiday and the bill is paid via BPAY on 31st Sept.

The payment is processed and settled by the Reserve bank on 31st Sept. But the payee's financial institution clears funds in the payee's account on 3rd October. When is the payment deemed to be received? Kindly refer me to the appropriate legislation and precedent cases with regards to all  queries.

Thank you.

Answered

Firstly, there is no legislation dealing with payments due on a public holiday. This is a matter of contract and you will have seen that most agreements provide that if an amount falls due for payment on a public holiday, payment may be made on the first business day thereafter.

As payment and time limits are contractual in nature and not legislative refer to the body corporate’s by laws or any other agreement in place.

The Cheques Act 1986 deals with cheques. Payment is made on receipt of a cheque conditional upon it being honoured. Electronic payments or cash payments that need to be electronically transmitted are an instruction to pay and payment is made when received by the recipient. For payments to be made by the due date, the delay in electronic transmission needs to be allowed by the person paying.

The Electronic Funds Transfer (EFT) Code of Conduct requires account institutions to prepare for their users clear and unambiguous terms and conditions applicable to EFT transactions.

Post office procedures are found in the Australia Post Bill Pay Terms and Conditions. See in particular item 7 which deals with transaction processing.

Regards

Mentor