Chapter 32 - to the check had insufficient funds when he...

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Chris Hertzog BA 242 Chapter 32 Problems 1. Well the first 2 checks said for deposit only, so the bank should have only deposited them not cashed them, so the cash disbursement of the first 2 checks was not legal and thus fault goes to the bank. The 3 rd check was cashed correctly, even though the signature was forged, and thus the fault goes to the employee that forged the name. 2. Dental Supply Inc, should have made the stamp to say “For Deposit Only” instead of just Dental Supply Inc, and thus the bank can only deposit them, and not disburse funds to Wilson. 5. Halbert is a holder in due course because he did not know that the account linked
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Unformatted text preview: to the check had insufficient funds when he accepted it and neither did Axe. So Halbert is a due course holder because if dishonored commercial paper. 6. The bank in this case is not the holder in due course because they cashed the check illegally. Because the check was made payable to Guardian of the estate of Chad Stephen Alcombrack, the bank should have required proof that Charles was the guardian such as the letters of guardianship. So Smith should file suit against Charles for fraud, not the bank. But since the bank did cash the check he could bring suit against them for cashing the illegal check....
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This note was uploaded on 05/06/2008 for the course B A 242 taught by Professor Mr.scheib during the Spring '08 term at Pennsylvania State University, University Park.

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