A Holder in Due Course can be defined as a holder who takes a negotiable instrument in good faith, without noticing that such instrument has been dishonored or that there is a hiden fraudulent issue behind it. In this particular case, I don’t think that Any Kind Checks Cashed, Inc. should be considered as a Holder in Due Course. It is clear that ‘Any Kind’ company did not know what the issue behind that check was but, they should have speculated that there was something strange going on.Apparently, there was a business that had been operating for a while and that they understood and know what kind of people will normally visit their store to cash their checks. I consider that the issue arises when Michael of Any Kind Cashed Checks, decides to pay a portion of the check made by Talcott and deposit the rest without trying to reach the drawer in order to confirm such transaction. I think that doing so, Any Kind Cashed Checks failed to comply with the reasonable commercial standards of fair dealing such as good faith.
If Talcott was unreachable, Michael should have Guarino come back at a later time or at least called the bank and see what the status of the check was. One thing is clear; Guarino did not attempt to go to the bank because he knew something could go wrong if he did. If Any Kind Cashed Checks would have only noticed that a broker shouldn’t have anything to hide and that a person like him would normally go to the bank instead of a checks cashing store the story would have surely been different.
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Personally, I agree and disagree with the court’s decision over this case. I consider that Talcott shouldn’t be liable for the $5,700. He actually was victim of a fraud and he has valid real defenses against Rivera and Guarino. Any Kind is not in fault in this specific scenario because they waited for the owner’s confirmation in order to cash the check. I would think that Talcott would be able to get his money back and of course sued these two men who took advantage of his age to cheat.
On the other hand I believe that Any Kinds should be held liable for the $10,000. Furthermore, Michael specifically, which as a supervisor should have not only known the procedure but should have also followed it. I am guessing she was lead by the fact that she would have received a nice commission out of a $10,000 check and didn’t think twice when she cashed and deposit the check without the owners approval. The case doesn’t state much information on this but if I am not wrong she also lost due to the fact that the check had a stop payment request by the owner.
In conclusion, I would like to state that I don’t believe Any Kind Cashed Checks is or should be considered as an HDC due to the fact that they relied on their own judgment and experience at the moment of cashing and depositing the $10,000 check. There is a clear failire to the good faith principle in such a scenario. Moreover, showing a federal express envelope to prove that Talcott truly sent the check shouldn’t be sufficient evidence to prove everything is correct.
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