The case, State of Qatar v. First American Bank of Virginia , held that:
A) the phrase "for deposit only" is not an effective restrictive indorsement.
B) depositary banks are not required to handle checks consistent with the restrictive indorsement.
C) the phrase "for deposit only" effectively limits the depositary bank to handle the instrument in a manner consistent with the transaction.
D) a stolen check which is indorsed in blank cannot be freely negotiated by the bearer.

Question

Quizplus · Accepted Answer

The case State of Qatar v. First American Bank of Virginia held that the phrase "for deposit only" is an effective restrictive indorsement, which limits how the depositary bank can handle the instrument, ensuring it is processed in a manner consistent with the restrictive endorsement.

The Case, State of Qatar V