Business Law

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Review the case of Any Kind Checks Cashed, Inc. v. Talcott in Chapter 30 of the text. Write a short paper on whether or not you agree with the Court’s decision. Is it fair? In your opinion, is Any Kind a HDC? A holder in due course is a holder who takes an instrument without “apparent evidence of forgery or alteration” for value, in good faith, and without notice of certain claims and defenses. In the case of Any Kind Checks Cashed, Inc. v. Talcott it was crucial to determine whether holder of the instrument acted in good faith and fair dealing, as is required to have status of holder in due course. The definition of “good faith” is found in Commercial Law Article § 3-103(a)(4): “Good faith’ means honesty in fact and the observance of reasonable commercial standards of fair dealing.” The court upheld a trial court finding’s that Any Kind had not acted in good faith in cashing a check for $10,000 but had been in good faith in later cashing another check for $5,700. I agree that Talcott was responsible for the $5,700 even though he was fraudulently induced to issue the check. In this case, a supervisor with the authority to approve checks over $2000 at the check casing company, had actually called Talcott and gotten his oral approval for cashing the check, and in doing so Any Kind satisfied the good faith requirement for a holder in due course. However, in the earlier cashing of the check for $10,000, the manager tried calling Talcott to get his approval, but had not been able to reach him. So the supervisor relied solely on her judgment and experience and in doing so had not acted in good faith. Had the check cashing store asked Talcott whether the $10,000 check was valid when it was presented by Guarino, it would have learned that Talcott had placed a stop payment order on it. Moreover, circumstances under which funds were released to endorser without authenticating check with its maker, should have aroused suspicion of the Any Kind. Guarino had not been a...
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