Business Law 13th Edition by Frank Cross, Kenneth Clarkson, Roger LeRoy Miller

Exercise 12

Bearer Instruments. Eligio Gaitan borrowed the funds to buy real property in Downers Grove, Illinois, and signed a note payable to Encore Credit Corp. Encore indorsed the note in blank. Later, when Gaitan defaulted on the payments, an action to foreclose on the property was filed in an Illinois state court by U.S. Bank, N.A. The note was in the bank's possession, but there was no evidence that the note had been transferred or negotiated to the bank. Can U.S. Bank enforce payment of the note? Why or why not? [U.S. Bank National Association v. Gaitan, 2013 IL App (2d) 120105-U, 2013 WL 160378 (2013)] (See page 487.)