Bob receives a check from Chris. Without Bob's knowledge, Dan indorses it in his own name and deposits it in his account at East Bank. In Bob's subsequent suit against East Bank for the money, the court will most likely rule in favor of
A) Bob, because Dan's signature is not authorized.
B) Bob, because East Bank is not a holder in due course.
C) East Bank, because Dan's signature is not authorized.
D) East Bank, because it is a holder in due course.

Question

Quizplus · Accepted Answer

Dan's signature was unauthorized, making the endorsement invalid. Therefore, East Bank cannot claim the check was properly negotiated, and Bob retains the right to the funds.

Bob Receives a Check from Chris