As payment in advance for services to be performed, Acton signed and delivered the following instrument: December 1, 2011

LAST NATIONAL BANK

MONEYVILLE, STATE X

Pay to the order of Olaf Owen $10,500.00

Ten Thousand Five Hundred Dollars for services to be performed by Olaf Owen starting on December 6, 2011.

Owen requested and received Last National Bank’s certification of the check even though Acton had only $9,000 on deposit. Owen indorsed the check in blank and delivered it to Dan Doty in payment of a preexisting debt.

When Owen failed to appear for work, Acton issued a written stop payment order ordering the bank not to pay the check. Doty presented the check to Last National Bank for payment. The bank refused payment.

What are the bank’s rights and liabilities relating to the transactions described?