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4 Cards in this Set
- Front
- Back
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WHERE DOES THIS COME UP
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Employee signs employers checks w/ authorization, etc
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PROPERLY PAYABLE RULE
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The drawee bank that honors a forged check MUST re-credit the drawer's account UNLESS drawer was negligent.
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WHAT ARE THE DRAWEE BANK'S REMEDIES?
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(1) THE THIEF IS ALWAYS LIABLE
(2) THE DRAWEE IS LIABLE IF NEGLIGENT |
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WHAT IS NEGLIGENCE HERE?
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(1) EMPLOYER INDORSEMENT RULE
Employer is negligent if employee was ENTRUSTED w/ handling checks (2) BANK STATEMENT RULE: Customer must report wrongdoing to bank WITHIN 30 DAYS of GETTING BANK STATEMENT showing the wrong. (3) IMPOSTER RULE If imposter induces drawer to write a check drawer is negligent (4) NEGLIGENCE ALSO INCLUDES: leaving blanks on spaces in instrument, failing to follow internal procedures, keeping signature stamp in same unlocked drawer as checks, etc. |
