BUSINESS LAW QUESTION

Answer with a complete IRAC analysis. IRAC is Issue, Rule, Analysis, Conclusion.

Issue: Will the bank have to repay the money to Ajax Corporation

Rule: (include every rule of law that applies)

Analysis: (Explain how the rules apply and why)

Conclusion: (Say how the court would rule the problem)

The Mark Trotter, the treasurer of Ajax Corporation was having trouble paying his bills. He prepared all the checks each month for the CEO to sign. In order to pay his credit card bill he made out a check to Visa Corp (his credit card company). He explained to the CEO that the check to Visa Corp was to pay for various shipping charges of goods that were sent to Ajax Corporation. The CEO signed the checks and gave them to the treasurer. Mark took the Visa check and put that into his account by signing that check with a forged signature. This went on for three months before the CEO discovered the fraud. Applying the correct rule(s) of law, will Ajax Corporations bank have to repay the money to Ajax Corporation? You may assume the checks were negotiable.