Cengage Advantage Books: Fundamentals of Business Law 9th Edition by Roger LeRoy Miller

Exercise 11

Forged Drawers' Signatures. Debbie Brooks and Martha Tingstrom lived together. Tingstrom handled their finances. For five years, Brooks did not look at any statements concerning her accounts. When she finally reviewed the statements, she discovered that Tingstrom had taken $85,500 from Brooks's checking account with Transamerica Financial Advisors. Tingstrom had forged Brooks's name on six checks paid between one and two years earlier. Another year passed before Brooks filed a suit against Transamerica. Who is most likely to suffer the loss for the checks paid with Brooks's forged signature? Why? [ Brooks v. Transamerica Financial Advisors, 57 So.3d 1153 (La.App. 2 Cir. 2011)] (See The Bank's Duty to Honor Checks.)