Case 27-3 - the check in the bank to cash it, bank accepted...

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Case: 27-3 Issue: if bank honor the check of the person whose dead and banks knows about the death of client still bank liable for the amount to the heirs of the clients? Rule: Under the UCC4-405 and UCC4-404 bank can honor the check of the person without knowing that the person is alive or not. Even if the banks knows the person is dead they can still honor the check until specify from the heirs to stop payment. It’s a bank thing to honor the stale check or not Application: The person made a mistake when writing the check he put the last year date instead of current year and give to the assistant. After that he died and when the assistant present
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Unformatted text preview: the check in the bank to cash it, bank accepted the check. Joyces wife of the client sued the bank to re credit the amount that they take it out from her dead husband account and also the check dated for last year. Conclusion: Bank is not liable for anything because they do know the person is dead but they do not have any type of instruction from heirs at the time of check processing. Second then bank is also not liable that they honor the check dated for last year because bank can honor the stale check in good consideration and charge the client for that....
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