Asked by Christian DelaRosa on Jul 25, 2024
Verified
Winston was going to be out of town on September 1,when his rent would be due.On August 20 he gave his landlord Becky a check dated September 1,with instructions not to deposit or cash the check until September 1.As the instructions to Becky were clear,he did not notify the bank of the postdated check.On August 21,Becky deposited the check in her account at her bank and the check was dishonored on August 23.Which of the following is true of this scenario?
A) Winston has recourse against Becky as she did not follow his instructions.
B) Winston has recourse against Becky and the bank since it failed to refuse the item when deposited.
C) Winston has recourse against the bank as it failed to notify Winston of the check acceptance and failed to refuse the item when deposited.
D) Winston did not notify the bank not to pay it before the date on the check,hence he has no recourse.
Postdated Check
A check written with a future date, delaying the ability of the recipient to cash or deposit it until that date.
Dishonored
Refers to a financial instrument, such as a check or promissory note, that has been refused payment when presented.
Landlord
A person who owns real property and who rents or leases it to someone else. Also called lessor.
- Comprehend the legal consequences associated with the utilization, non-acceptance, and correction of cheques in bank dealings.
- Detail the responsibilities of banks concerning the acceptance or denial of checks, covering both postdated checks and checks issued from the accounts of decedents.
Verified Answer
AB
allproducts businessJul 28, 2024
Final Answer :
D
Explanation :
Winston's failure to notify the bank not to pay the check before the date on it means he cannot hold the bank responsible for honoring the check when deposited by Becky, despite her not following his instructions.
Learning Objectives
- Comprehend the legal consequences associated with the utilization, non-acceptance, and correction of cheques in bank dealings.
- Detail the responsibilities of banks concerning the acceptance or denial of checks, covering both postdated checks and checks issued from the accounts of decedents.