Question

Susan purchases goods by telephone from parker, Susan has never met parker, Brenton goes to Susan and pretends to be Parker. Susan draws a check payable to the order of Parker and gives the check to Brenton, believing him to be Parker. Brenton forges Parkers indorsement and indorses the check to his brother, William, with the term "without resourses". William then cashes the check at a liquor store. Under the imposter rule, who is liable on the check?

A) BrentonB) the liquor storeC) SusanD) William

Answer 1

C) Susan

Step-by-step explanation:

The imposter rule (Section 3-405 of the UCC) states that the drawer of a check is liable for the checks that they draw. The logic behind the imposter rule is that the drawer of the check should be responsible for the checks that they draw because they supposedly know who they are drawing and giving a check to. In this case, the check was not stolen from Susan, she gave it voluntarily to Brenton. Susan was in a much better position to know that Brenton was not Parker than her bank.