Amica International Group, Inc. (AIG), an insurance company, issued a check in t

Question

Amica International Group, Inc. (AIG), an insurance company, issued a check in the amount of $5,000 to Jonathan Wilson in connection with a personal-injury matter. Wilson presented the check to A-1 Check Cashing Emporium (A-1) for payment. A-1’s clerk paid Wilson the $5,000, but forgot to have Wilson sign the check. When he could not reach Wilson to ask him to come back to A-1 to sign the check, the clerk printed Wilson’s name on the back and deposited it at Community Bank. Community Bank refused to pay the check, so A-1 sold it to Robert Johnson, who is in the business of buying dishonored checks. When Johnson could not get the check honored, he sued AIG, contending that he, through A-1, had the right to collect on the check as a holder in due course (HDC). The trial court rejected that claim. Johnson appealed. should wilson be required to return the money to A-1 and was community bank right in refusing to pay the check

Explanation / Answer

Wilson should not be required to return the money to A-1 and community bank was not right in refusing to pay the check.

Reason: - Wilson had no fault in this. He will be in safe position. Further community bank ought to pay the check.

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