Consider the following statements regarding the termination of the banker-customer relationship: Statement 1: The relationship between a banker and a customer is terminated upon the death of the customer, and the banker must stop payments from the account once they receive reliable notice of the death. Statement 2: If a customer is declared insane by a competent authority, the banker must suspend the operation of the account because an insane person is incapable of giving a valid mandate. Statement 3: An order of adjudication in insolvency against a customer serves as a revocation of the banker's authority to pay cheques drawn by the insolvent customer. Statement 4: A customer has the unilateral right to close their account at any time, and the bank must comply immediately even if the customer has a significant outstanding loan that is not yet due for repayment. Which of the following summaries regarding the statements above is correct?

Question

Accepted Answer

Statements 1, 2, and 3 are correct, but Statement 4 is incorrect because a bank can refuse to close an account if there are outstanding liabilities.

Answer

Statements 2, 3, and 4 are correct, but Statement 1 is incorrect.

Answer

Only Statement 1 and Statement 2 are correct based on historical context.

Answer

All statements are correct because the banker-customer relationship is purely voluntary and can be terminated by either party without notice.

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