Asked by ashish adhikari on May 02, 2024
Verified
Tom wrote a check to Mary for $10.Tom was careful and not negligent in the way he wrote the check.Nevertheless,Mary cleverly altered the check to read $1,000.Tom's bank cashed this check and deducted that amount from his account.Which of the following is correct?
A) Tom is liable on this check,but only for $10.
B) Tom is liable on this check for $1,000.
C) Tom is liable on this check for nothing.
D) Tom must reimburse the bank for any losses it suffers related to this check.
Cleverly Altered
Describes something modified in a skillful or ingenious manner.
Check Deduction
A payroll or accounting action where a specific amount of money is subtracted directly from an employee's paycheck.
Bank Liability
The legal responsibilities and obligations a bank has towards its customers, such as ensuring the security of deposits and providing accurate account information.
- Understand the legal responsibilities and protections provided to consumers and banks by the Uniform Commercial Code (UCC) with regard to the modification and counterfeit of checks.
- Acquire knowledge on the responsibilities and legal burdens of drawers and endorsers in relation to the alteration of checks, acts of negligence, and restitution processes.
Verified Answer
VR
Veronica RogersMay 02, 2024
Final Answer :
A
Explanation :
If the alteration is obvious,the bank should note that fact and refuse to pay the check when it is presented for payment.Occasionally,the alteration is so skillful that the bank cannot detect it.In that case,the bank is allowed to charge to the account the amount for which the check originally was written.
Learning Objectives
- Understand the legal responsibilities and protections provided to consumers and banks by the Uniform Commercial Code (UCC) with regard to the modification and counterfeit of checks.
- Acquire knowledge on the responsibilities and legal burdens of drawers and endorsers in relation to the alteration of checks, acts of negligence, and restitution processes.
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