The City mails Joe Marsh a refund check for overpayment of a parking ticket.Harold Finch steals the check from Marsh's mailbox,signs "Joe Marsh" on the back of the check,and cashes it at a grocery store.Is the grocery store a holder of the check?
A)Yes,because Finch indorsed the check.
B)Yes,because it is a holder in due course.
C)No,because Finch was not a holder and the check was not signed by Marsh.
D)No,because the check contained no indorsements.

Question

Quizplus · Accepted Answer

The grocery store is not a holder of the check because its transferor,Finch,was not a holder and because it needs Marsh's signature to have a good chain of authorized indorsements.Marsh has to indorse the check in order for there to be a valid chain of indorsements.Finch's signature is not effective for this purpose because Marsh did not authorize him to sign Marsh's name to the check.

The City Mails Joe Marsh a Refund Check for Overpayment