1. Primary Liability means that one is unconditionally liable and therefore must pay unless he has a valid defense. A secondary liability means that the person only has to pay if the primary liability does not pay. 3. Bank can ask for identification and dishonor the check if they choose to. 5. The drawee bank is liable if it pays a check on which the drawer’s name is forged. The bank can recover from the payee only if the payee had reason to suspect the forgery. 7. Yes it is illegal to write a check on an account that has insufficient funds. Generally, no serious penalties are imposed if sufficient funds are immediately deposited. 9. Nonsufficient funds checks or dishonored checks. 11. 11. John took his check from work to his depositary bank which is Suntrust. The employer uses Citibank so they would be the payor bank. Then in order for the check to be cleared it must go to an intermediary bank which cannot be the payor bank or the depositary bank. The intermediary bank in this scenario is the federal reserve which is a
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