V. ANSWERS TO PROBLEMS AND PROBLEM
CASES:
1. Yes. Every indorser is obligated that upon dishonor and notice of dishonor and protest,
he
will pay the instrument to the holder. Unless the indorser qualified the indorsement,
the
2. Yes. Where the signer of the note failed to indicate that he was signing in a
representative
3. No. The UCC defines an
“unauthorized”
signature or indorsement as one made with actual,
I
implied or apparent authority. Here, Haynes was acting within the scope of his
apparent
4. No. The court held that the check cashing agency’s only recourse was against the
wrongdoer
5. The bank is only liable for the amount of twenty-nine dollars. UCC Section 4-303
provides
that the maker or drawer is obligated to pay the instrument according to its tenor at the
time
6. The collecting bank is liable. Under U.C.C. 4-207 (2), Merchant’s
Banlc
warrants that all
prior
indorsements are authorized. Since the forged signature is obviously not authorized
this
7. Neely had to bear the loss. He had substantially contributed to the alteration by
the
negligence. Mrs. Neely signed the checks with the gaps that made the alteration possible
and
8. No. Under section 3-405(1)©, an indorsement of a forger is effective if the forger as an
employee of the drawer has supplied the drawer with the name of the payee intending
the
9. Yes. When Gristendes Supermarket accepted, cashed and obtained payment from the
drawee
bank for the stolen and forged, checks, Gristendes had converted Stockton’s property and
was