Issues of Check 1: mention possible negligence in one sentence. Can it recover it loses from someone else?

? Possible from the presentment bank breach of presentment warranty: there are 2 breached the a1 and a2 a1 the bank is entitled to present the check and a2 that the check is not altered. Is there is reporting requirement issue? The reason why it was not pay=id to a holder was bc it was altered to be payable to cash, so 406 is implicated. But in the sept. 1 statement something was out of the ordinary and the only reporting requirement here is a 1 year period reporting requirement. The only reporting requirement is 1 year rule and this report was done within 1 year so there is no reporting requirement problem bc the 1 year has not passed. The validation rule for responsible employees bc there is no fraudulent endorsement to validate bc the rule does not validate ... Check 2: Check 2 is different bc this is payable to stamps unlimited and it is again stolen by Jones who takes the check to stamps unlimited and exchanges it for a valuable stamp. Can STS its account re-credited. a check is properly payable if it is not altered, signed by a drawer and .. here the check is properly payable. Does STS have to pay stamps unlimited underlying obligation rule under 3-310 was this check taken for the underlying obligation for STS or was this taken for the underlying obligation for the stamp Jones bought with Stamps unlimited? Stamps unlimited had to inquire to the authority jones has to pay for a stamp issued by STS and therefore Unlimited is partly at fault for this, or you can argue the opposite that under this fact is is difficult to determine for which underlying obligation was satisfied in this transaction. Dies this check relate to the earlier obligation of STS to unlimited or to the payment of the stamp bc we have a rule that states that a check suspends the underlying obligation. If it is relating to Unlimited then STS does not have to issue a second check but if it does not go to that obligation then STS would be the stucky and has to issue a second check. Here the fault lies with Unlimited in assuming that jones had authority to pay the stamp with the check solely on HIS representation that he can. This is the problem of employee deposited the checks to her person acct but the employer write them to his personal acct. Check 3: Check 3 was written to the dentist Teeth then Teeth endorsed restrictively in blank= instructed any payment made to his benefit bc he did not specify a payee so he turned it into a bearer instrument one negotiable .... Then it got stolen and bc it is a bearer instrument the juvenile is a holder even though he is a juvenile he has the capacity to negotiate the instrument and when he negotiated to fagan then fagan is a holder and DNB is a holder too when it tried to collect from INB. Is this check properly payable? Yes it is it was paid to a holder signed to a drawer and not altered, does the restrictive endorsement bin other then the drawer bank? no the drawee bank only had to honor the properly payable check, it had nothing else to do.

What did it pay for? it paid for the obligation for which teeth took it and therefore teeth obligation was discharged and teeth has no claim against Stamps for the dental work and has been paid. Does teeth have a remedy? .... Check 4: Check 4 is the responsible employee rule, here it was a fraudulent indorsement but it was effective bc the employee was a responsible employee bc he prepares the payroll check so he is responsible employee so when he steals the check and fraudulently endorses it then his signature is effective under 3-405. So bookkeeper who took the check did nothing wrong so you can invoke 3-404 the fictitious payee rule and if you conclude that Casey is a fictitious person then that rule would produce the same result it would produce the check as a indorser instrument and is was effectively payable. So is the check properly payable and the answer is yes and if it is properly payable INB cannot get the refund from anyone. Check 5: Check 5 is payable to Milken who is a coconspirator of the Emplezzler and contains a forged signature by embezzler. Is the drawer entitled to have the check recredited. A check paid out with a forged signature is not properyl payable unless we have a rule that makes it effective. the first statement was sent out may 10 that contained the forged check you have a 1 year rule for reproting and the chekc was reported before the 1 year was up so the 1 year rule is not an obsticle to having the check recredited. The same wrongdior rule is not an obstacle bc it is the sencond check by him. The same wrongdoer rule we look to the first statement that contains a check forged or altered by the same wrongoer that sets in motion the 30 day rule of future alteration but it does not affect the same checks in the same statement only subsequent ones. This is a check that contains a forged sognature and is not preorply payable and must be recredited to the account of STS. can the draweer bank shift its loss to the depositary bank? No bc the depository bank is the drawee bank so not loss shifting here. Check 6: same wrongdoer and the same statement was sent on the 10 and the second check was done on the 14th. The bank for the same reason that it has to recredit check 5 also has to recredit check 6. check7: This is the check that is payable from STS to its employee to MB and he alters it from 750 to 7500 dollars takes it to BNB and BNB collects 7500 from INB and permitted him to withdraw the 7500. The check is paid to a holder BNC the embezzler is the holder of the check bc he was the payee, Accordingly the drawee bank may charge the acct of STS but only form 750 dollars the original acct so they have to recredit the rest to STS.

But BNB is a holder in due course, and had not notice of the alteration BUT they lose bc they breached the presentment warranty being a HDC does not mean you always win so BNB bears the loss of the rest that was not properly payable from the drawer acct. A bank does not have knowledge of the alteration when you breach the presentment warranty. Had he reported within 2 business days the most he would have lost would have been 50 dollars and being that missed he owed $500, but here he did not violate the bank statement rule bc all of the withdraws occur within 60 days so the most Sununu can lose is 50 so he can have his account recredited for the rest. But he is negligence for leaving his PIN on the card but negligence plays no role and he is only on the hook for the first 50 dollars if he reports within the 3 business days and the only way he would be resp. for more than 500 is he does not report within the 60 days and additional withdraws have been made at day 61.