Question: Brenda Jones who did business as Country Kitchen purchased some

Brenda Jones, who did business as Country Kitchen, purchased some cookware from an itinerant salesman, giving him a check in the amount of $200 for the purchase price. The salesman cashed the check at the First National Bank before noon on May 22, the day of the sale. Jones later became concerned about the lack of documentation from the salesman, thinking that the cookware might be stolen, and placed a stop-payment order with her bank, the State Bank of Conway Springs, at 3:30 that afternoon. State Bank refused to honor the check when it was presented for payment through banking channels. First National Bank, claiming to be a holder in due course, then brought suit against Jones to recover the $200 value of the check. Is the drawer of a check on which a stop-payment order was placed and honored by the bank liable to pay the check to a holder in due course?

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  • CreatedJuly 16, 2014
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